B. The target of Co. X is to maintain a financial leverage of 48%. The Co. has deviated negatively from the target by 5%. The equity multiplier of the Co. is a round 1.84. The Financial Gearing of the Co. is expected to be: a. 0.544 b. 0.839 с. 0.48 d. None of the above

B. The target of Co. X is to maintain a financial leverage of 48%. The Co. has deviated negatively from the target by 5%. The equity multiplier of the Co. is a round 1.84. The Financial Gearing of the Co. is expected to be: a. 0.544 b. 0.839 с. 0.48 d. None of the above

Entrepreneurial Finance

6th Edition

ISBN:9781337635653

Author:Leach

Publisher:Leach

Chapter10: Valuing Early-stage Ventures

Section: Chapter Questions

Problem 1fM

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Concept explainers

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.

Question

Please help me

В.
The target of Co. X is to maintain a financial leverage of 48%. The Co. has deviated
negatively from the target by 5%. The equity multiplier of the Co. is a round 1.84. The Financial
Gearing of the Co. is expected to be:
a.
0.544
b.
0.839
c.
0.48
d.
None of the above

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