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A Firm Has 5,000 Shares of Stock Outstanding with a Market

Question 64

Multiple Choice

A firm has 5,000 shares of stock outstanding with a market value of $23.60 a share,$74,800 of long-term debt with an interest rate of 7.5 percent,cash on hand of $6,400,sales of $198,000,costs of $107,200,and depreciation of $13,400.The tax rate is 35 percent.What is the enterprise value multiple?


A) 2.05 times
B) 3.97 times
C) 2.19 times
D) 4.18 times
E) 3.10 times

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