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Question
Estimate the value of a privately held firm based on the following information: total market value (or capitalization value) of a comparable firm = $200,000; net income of the comparable firm = $40,000; number of shares outstanding for the comparable firm = 20,000; net income for the target firm = $15,000; and number of shares outstanding for the target firm = 10,000.
a. $7.50
b. $10.00
c. $12.50
d. $15.00
Answer
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