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Consider a firm with the following financial characteristics: Assets Book Value Market Value Liabilities and Equity Book Value Market Value Cash $1,000 $1,000 Long-term Bonds

Consider a firm with the following financial characteristics:

Assets Book Value Market Value Liabilities and Equity Book Value Market Value
Cash $1,000 $1,000 Long-term Bonds $1,500 $1,500
Fixed Assets 2,000 500 Equity 1,500 -
Total $3,000 $1,500 Total $3,000 $1,500

A. Assuming the firm is liquidated today, how much do the long-term bondholders and shareholders receive?

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