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Based on the discounting of the Free Cash Flow to the Firm, a publicly - traded firm has an estimated total value of 5 3

Based on the discounting of the Free Cash Flow to the Firm, a publicly-traded firm has an estimated total value of 53bn. The value of the equity (based on the share price x number of outstanding shares) is 53bn. The value of the debt is 10bn. The difference between the 2 amounts (53bn and 63bn) can be explained by all the reasons below except (choose one):
A. Your cost of debt is different from the one taken into account by the market
B. Your assumption for the strength of the signalling value of debt is different from the one taken into account by the market.
C. Your WACC is different from the WACC the market is using to value this firm
D. Your assumptions for the Return on Capital of this firm is different from the one taken into account by the market
E. Your assumption for future growth is different from the one taken into account by the market

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