The Balance Sheet of a firm has the following items of the Right Side: Short Term Debt $4,459 Long Term Debt $2,880 Accounts Payable $3,183 Total Liabilities & Owners Equity $12,523 Other firms in the same industry have an average Market Price of Equity to Book (P/B) ratio of 6. Assuming the firm should have a P/B ratio equal to the average, what should the Market Price of Equity of the firm be? =
The Balance Sheet of a firm has the following items of the Right Side: Short Term Debt $4,459 Long Term Debt $2,880 Accounts Payable $3,183 Total Liabilities & Owners Equity $12,523 Other firms in the same industry have an average Market Price of Equity to Book (P/B) ratio of 6. Assuming the firm should have a P/B ratio equal to the average, what should the Market Price of Equity of the firm be? =
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question

Transcribed Image Text:The Balance Sheet of a firm has the following items of the Right Side:
Short Term Debt
$4,459
Long Term Debt
$2,880
Accounts Payable
$3,183
Total Liabilities & Owners Equity
$12,523
Other firms in the same industry have an average Market Price of Equity to Book (P/B) ratio
of 6. Assuming the firm should have a P/B ratio equal to the average, what should the Market
Price of Equity of the firm be?
=
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