The company recently reorganized its debt structure at no extra expense, consolidating all liabilities into a single bond maturing in precisely 5 years. This strategic move involved issuing new debt in an amount sufficient to retire all existing current liabilities and the long-term debt. Consequently, your Balance Sheet now solely consists of Owner's Equity and Long Term Debt. Present estimates suggest that the Market Value of the firm's assets stands at $40 million, with an approximate standard deviation of 23%. What are the Market Value numbers for the Equity and Debt?  

Answer rating: 100% (QA)

Lets break down the calculation for the Market Value of Equity and the Market Value of Debt based on the given information Market Value of Equity MVE ... View the full answer