Chapter 13, Problem 8PS

A firm has current assets that could be sold for their book value of $\$\text{1}0$ million. The book value of its fixed assets is $\$\text{6}0$ million, but they could be sold for $\$\text{9}0$ million today. The firm has total debt with a book value of $\$\text{4}0$ million, but interest rate declines have caused the market value of the debt to increase to $\$\text{5}0$ million. What is this film’s market-to-book ratio? $\left(\text{LO 13}-\text{1}\right)$