Consider the following equation for the question(s)below:
E + D = U = A
-The A in the equation above represents
A)the value of the firm's unlevered equity.
B)the value of the firm's equity.
C)the value of the firm's debt.
D)the market value of the firm's assets.

Question

Quizplus · Accepted Answer

The equation E + D = U = A represents the value of the firm's assets, which is equal to the sum of the value of its unlevered equity (U) and its debt (D). Therefore, the correct answer is D, the market value of the firm's assets.

Consider the Following Equation for the Question(s)below