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Please give me the answer with a detailed explanation. During lockdown you decided to start a new online marketing business on promoting new Instagram influencers.
Please give me the answer with a detailed explanation.
During lockdown you decided to start a new online marketing business on promoting new Instagram influencers. If your business is successful, the company can be sold for $30 million. If it is unsuccessful it will be worth $0. You decide to raise $2 million dollars to help fund your business. Investors are willing to invest $2 million in exchange for 50% of unlevered equity in the company. There are no taxes at present. What is the total market value of the firm without leverage?
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