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Asked Nov 1, 2019

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Question: Assuming the **debt-equity ratio is 0.70**, what is the **value of the Microsoft**? Which factors are missing when calculating the firm value with just this amount of data?

Shares outstanding: 7,753,000,000

Current stock price: 137.32

Step 1

Firm’s value represents the total value including market capitalization, debt (long-term and short-term both) and cash balance as per company’s balance sheet.

Step 2

Given:

Debt-equity ratio = .70

Shares outstanding = 7,753,000,000

Current stock price = $137.32

Step 3

Calculations:

Formula to calculate...

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