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guajiro [1.7K]
3 years ago
9

The book value of a firm's equity is $100 million and its market value of equity is $200 million. The face value of its debt is

$50 million and its market value of debt is $60 million. What is the market value of assets of the firm
Business
1 answer:
UNO [17]3 years ago
6 0

Answer:

$260 million

Explanation:

In this question, we are asked to calculate the market value of assets of the firm.

To do this, we use a mathematical formula. The mathematical formula to use is that of the Market value of assets of the firm.

Mathematically, the market value of assets of the firm = Market value of equity + Market value of debt

From the question, market value of equity = $200 million

The market value of debt = $60 million

Market value of assets of the firm = $200 million + $60 million = $260 million

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