Question: Question 32 (1 point) Kane Innovations will have a value of either $100 million, $150 million, or $191 million in one year with each outcome

Question 32 (1 point) Kane Innovations will have a value of

Question 32 (1 point) Kane Innovations will have a value of either $100 million, $150 million, or $191 million in one year with each outcome being equally likely. The cash flows are unrelated to the state of the economy so that the firm has beta of zero and the debt and equity costs of capital equal the risk-free rate, which is 5%. Assume that the capital markets are perfect. Suppose that Kane has a (zero-coupon) debt payment of $125 million due in one year. The market value of Kane's equity is closest to: $29 $30 $139 $140

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