Question
Let the book value balance sheet be represented by these symbols: A = L + OE Let the market value balance sheet be represented by
Let the book value balance sheet be represented by these symbols:
A = L + OE
Let the market value balance sheet be represented by these symbols:
V = D + E
For a mature firm that that has been very successful in the past with a current market debt-to-assets ratio of 25% after impressive share price growth, which pair of the following amounts will be very close in value?
The pair of amounts that areclosestin value will be:
Select one:
a.A and V, the book and market values of assets.
b.L and D, the book and market values of debt.
c.OE and E, the book and market values of equity.
d.A and E, the book value of assets and market value of equity.
e.L and E, the book value of debt and market value of equity.
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