Louie's Truck Repair has assets with a market value of $8000.The company has three types of securities: equity,$2500 of debt,and 100 warrants that are fairly priced at $20 each.What is the value of Louie's equity?

Question

Quizplus · Accepted Answer

The market value of the assets is $8000. The debt is $2500, and the warrants are valued at 100 * $20 = $2000. Therefore, the equity value is $8000 - $2500 - $2000 = $3500.

Louie's Truck Repair Has Assets with a Market Value of $8000.The