Martha B's has total assets of $1,750. These assets are expected to increase in value to either $1,800 or $2,400 by next year. The company has a pure discount bond outstanding with a face
Value of $2,000.This bond matures in one year. Currently, Treasury bills are yielding 6 percent. What
Is the value of the equity in this ﬁrm?
A) $16.98
B) $34.59
C) $36.67
D) $37.08
E) $51.89

Question

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The Answer of Martha B's has total assets of $1,750. These assets are expected to increase in value to either $1,800 or $2,400 by next year. The company has a pure discount bond outstanding with a face
Value of $2,000.This bond matures in one year. Currently, Treasury bills are yielding 6 percent. What
Is the value of the equity in this ﬁrm?
A) $16.98
B) $34.59
C) $36.67
D) $37.08
E) $51.89

Martha B's Has Total Assets of $1,750