Answer:
$98 million
Explanation:
Kneeman markup company has a total debt obligation with a book value of $30 million
The market value is $28 million
The total equity has a book value of $20 million and a market value of $70
Therefore, the price that you should be willing today can be calculated as follows
Debt obligation market value+total equity market value
= $28 million + $70 million
= $98 million
Hence the amount that you should be willing to pay today is $98 million
Answer:
A. $0
B. $112
C. Investor A 14.3% gain
Investor B 18.5%
Explanation:
a) Based on the information given interest cost for investor A will be Zero
b) Calculation for What is the interestcost for investor B
Cost of interest =(100 shares*$35)×(100*%-69%)×0.08
Cost of interest = 3,500 x 0.40 x 0.08
Cost of interest =$112
c) Calculation for what percentage returndoes each investor earn
Investor A: 4,000 - 3,500 = 500/3,500
= 0.1428 =14.3% gain
Investor B: $500 gain - $112 interest
= $388/2,100 = 0.1848 =18.5%
Answer:
D the answer is D
Explanation:
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