Fundamentals of Corporate Finance Standard Edition
Fundamentals of Corporate Finance Standard Edition
10th Edition
ISBN: 9780078034633
Author: Stephen Ross, Randolph Westerfield, Bradford D. Jordan
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Chapter 2, Problem 11CRCT
Summary Introduction

To critically think about: The relevance of enterprise value to potential purchasers.

Introduction:

The enterprise value is the tool used to measure the value of the company. The enterprise value is the sum of market value of equity and debt minus the cash and cash equivalents held by the company. The following equation helps to calculate the enterprise value:

Enterprise value=(Market value of debt+Market value of equity)Cash and cash equivalents

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Fundamentals of Corporate Finance Standard Edition

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