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notka56 [123]
3 years ago
11

The current market value of the assets of ABCD is $86.28 million. The call option value on the firm's assets is $53.09 million.

What is the market value of the firm's debt
Business
1 answer:
Temka [501]3 years ago
6 0

Answer: $33.19 million

Explanation:

From the question, we are informed that the current market value of the assets of ABCD is $86.28 million and that the call option value on the firm's assets is $53.09 million.

The market value of the firm's debt will be the difference between the market value of assets and the call option value of the firm's assets. This will be:

= $86.28m - $53.09m

= $33.19 million

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