Use the information for the question(s)below.
Luther Industries has no debt,a total equity capitalization of $20 billion,and a beta of 1.8.Included in Luther's assets are $4 billion in cash and risk-free securities.
-What is Luther's enterprise value?
A)$16 billion
B)$10.5 billion
C)$24 billion
D)$20 billion

Question

Quizplus · Accepted Answer

Enterprise value is calculated as total equity capitalization minus cash and risk-free securities. Therefore, $20 billion - $4 billion = $16 billion.

Use the Information for the Question(s)below