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4. ZIA Co. will remain in business for one more year. The probability of a boom year is 70% and the probability of a recession
4. ZIA Co. will remain in business for one more year. The probability of a boom year is 70% and the probability of a recession is 30%. It is projected that the company will generate a total cash flow of 200,000$ in a boom year and 75,000$ in a recession. The market value of the companys outstanding debt is 80,000$. The company pays no taxes. In the case of an expansion, is the company able to pay all her debt? Justify.
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