The current market value of the assets of Samuelson, Inc. is $91 million. The market value of the equity is $47.63 million. What is the market value of the ﬁrm's debt?
A) $43.37 million
B) $47.63 million
C) $102.39 million
D) $121.39 million
E) $138.63 million

Question

Quizplus · Accepted Answer

The market value of the firm's debt is equal to the total market value of the assets minus the market value of the equity. Therefore, the market value of the debt is:
$91 million - $47.63 million = $43.37 million.

The Current Market Value of the Assets of Samuelson, Inc