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The probability the economy will do well next year is 78 percent, in which case...

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Accounting

The probability the economy will do well next year is 78 percent, in which case TradeNet will have a total value of $79,000. If the economy tanks, the firm's value will decline to $38,000. The firm owes its bondholders $62,000. What is the value of this firm to its shareholders if the firm will close after next year?

Answers

1.13,260

2.69,980

3. 7,980

4. 47,020

5. 131,980

Answer & Explanation Solved by verified expert
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