A Firm Has Current Assets That Could Be Sold for Their

question 37

Multiple Choice

A firm has current assets that could be sold for their book value of $10 million. The book value of its fixed assets is $60 million, but they could be sold for $95 million today. The firm has total debt at a book value of $40 million, but interest rate changes have increased the value of the debt to a current market value of $50 million. This firm's market-to-book ratio is ________.

• A) 1.83
• B) 1.5
• C) 1.35
• D) 1.46

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Definitions:

Union Security Clauses

Provisions in a labor contract that require employees to join, maintain membership in, or pay dues to a union as a condition of employment.

Closed Shop

A form of union security agreement wherein only members of the union can be hired, and employees must remain members of the union to retain their jobs.

Union Member

is an individual who has formally joined a labor union, a collective organization that represents the interests of workers in negotiations with employers.

Safety Standards

Regulations and practices designed to ensure the physical safety of workers and prevent workplace accidents or injuries.