In 2020, Caterpillar Incorporated had about 540 million shares outstanding. Their book value was $25.36 per share, and the market price was $153.70 per share. The company’s balance sheet shows that the company had $26.7 billion of long-term debt, which was currently selling near par value. What was Caterpillar’s book debt-to-value ratio? Note: Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places. What was its market debt-to-value ratio? Note: Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places. Which measure should you use to calculate the company’s cost of capital? NOTE: 0.66 (for book debt to value ratio)and 0.24 (for market debt to value ratio)is incorrect
In 2020, Caterpillar Incorporated had about 540 million shares outstanding. Their book value was $25.36 per share, and the market price was $153.70 per share. The company’s balance sheet shows that the company had $26.7 billion of long-term debt, which was currently selling near par value.
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What was Caterpillar’s book debt-to-value ratio?
Note: Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places.
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What was its market debt-to-value ratio?
Note: Do not round intermediate calculations. Enter your answer as a decimal rounded to 2 decimal places.
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Which measure should you use to calculate the company’s cost of capital?
NOTE: 0.66 (for book debt to value ratio)and 0.24 (for market debt to value ratio)is incorrect
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