Paroles GMBD Inc, has only a zero coupon bond outstanding with a $10,000 face value that matures in one year. The current market value of the firm's assets is $10,700. The standard deviation of the return on the firm's assets is 39 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 Paroles's equity? Based on the Black-Scholes model, what is the market value of Paroles's debt?

Paroles GMBD Inc, has only a zero coupon bond outstanding with a $10,000 face value that matures in one year. The current market value of the firm's assets is $10,700. The standard deviation of the return on the firm's assets is 39 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 Paroles's equity? $2,330.00 $2,239.16 $ 581.16 $2,423.20 $2,260.10 Based on the Black-Scholes model, what is the market value of Paroles's debt? $ 8,370.00 $ 8,460.84 $11,281.16 $ 8,704.80 $ 8,035.20