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Frostbite Thermalwear has a zero coupon bond issue outstanding with a face value of $24,000 that matures in one year. The current market value of

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Frostbite Thermalwear has a zero coupon bond issue outstanding with a face value of $24,000 that matures in one year. The current market value of the firm's assets is $28,000. The standard deviation of the return on the firm's assets is 51 percent per year, and the annual risk-free rate is 7 percent per year, compounded continuously. Based on the Black-Scholes model, what is the market value of the firm's equity? $ 8,350.32 $ 7,457.34 $15,317.42 $ 8,684.33 $ 8,016.31 Based on the Black-Scholes model, what is the market value of the firm's debt? $19,649.68 $20,542.66 $12,682.58 $20,435.67 $18,863.69 What is the firm's continuously compounded cost of debt? 20.00% 15.56% 63.78% 20.80% 19.20%

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