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Edelman Engines has $5 billion in total assets. Its balance sheet shows $0.5 billion in current liabilities, $2.75 billi...

Edelman Engines has $5 billion in total assets. Its balance sheet shows $0.5 billion in current liabilities, $2.75 billion in long-term debt, and $1.75 billion in common equity. It has 400 million shares of common stock outstanding, and its stock price is $31 per share. What is Edelman's market/book ratio? Round your answer to two decimal places.

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Answer #1

Book value per share=$1.75 billion/400 million shares

=$4.375 per share

market/book ratio=market value/Book value per share

=31/4.375

=7.09(Approx).

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