The value of the firm is the sum of all claims against it. These marketed and non-marketed claims:
A) increase in value together and are both bought and sold in the financial markets.
B) trade-off against one another in value with marketed claims bought and sold in the financial markets but not non-marketable claims.
C) decrease in value together and are both bought and sold in the financial markets.
D) trade-off against one another in value with both marketed and non-marketed claims bought and sold in the financial markets.

Question

Quizplus · Accepted Answer

Marketed claims are those that can be bought and sold in financial markets, such as stocks and bonds. Non-marketed claims, such as private agreements or internal company stakes, cannot be traded in these markets. The value of these claims can trade off against one another, but only marketed claims are traded in financial markets.

The Value of the Firm Is the Sum of All