Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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In mid-2015, Cisco Systems had a market capitalization of $121 billion. It had A-rated debt of $26 billion as well as cash and short-term investments of $63 billion, and its estimated equity beta at the time was
1.12.
a. What is Cisco's enterprise value?
b. Assuming Cisco's debt has a beta of zero, estimate the beta of Cisco's underlying business enterprise.
a. What is Cisco's enterprise value?
Cisco's enterprise value is $ billion. (Round to the nearest integer.)
b. Assuming Cisco's debt has a beta of zero, estimate the beta of Cisco's underlying business enterprise.
The beta of Cisco's underlying business enterprise is
(Round to two decimal places.)
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Transcribed Image Text:In mid-2015, Cisco Systems had a market capitalization of $121 billion. It had A-rated debt of $26 billion as well as cash and short-term investments of $63 billion, and its estimated equity beta at the time was 1.12. a. What is Cisco's enterprise value? b. Assuming Cisco's debt has a beta of zero, estimate the beta of Cisco's underlying business enterprise. a. What is Cisco's enterprise value? Cisco's enterprise value is $ billion. (Round to the nearest integer.) b. Assuming Cisco's debt has a beta of zero, estimate the beta of Cisco's underlying business enterprise. The beta of Cisco's underlying business enterprise is (Round to two decimal places.)
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