Details about starting a biotechnology firm: Successful research of technology can be sold = $30 million Required fund for research = $2 million Investors investment amount = $2 million Initial capital in exchange for 50% unlevered equity of the firm. (a) Calculate the total market value of the firm without leverage: All variables are as per given information. From the given information it is clear that investors will give $2 million towards the initial capital to 50% of unlevered equity of the firm. This indicates that 50% of the firm's value is $2million. Therefore, the total market value without leverage can be determined by dividing $2million by the 50% of the unlevered equity of the firm. Total market value without leverage= Amount paid by investors Percentage of stake $2 million 50% = $4 million