The Enterprise Value of a privately-owned firm is often discounted relative to their publicly-traded counterparts because:

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
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The Enterprise Value of a privately-owned firm is often discounted relative to their publicly-traded counterparts because:

 

  a.

A privately-owned firm cannot be sold as easily as a publicly-traded firm.

 

  b.

Employees will leave a privately-owned firm if sold.

 

  c.

The use of bank debt by privately-owned firms is troubling.

 

  d.

It is too difficult to calculate Enterprise Value for a privately-owned firm.

 

  e.

None of the above.

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