Question

In December 2018​, General Electric​ (GE) had a book value of equity of $51.7 ​billion, 8.6 billion shares​ outstanding, and a market price of $7.94 per share. GE also had cash of $68.3 ​billion, and total debt of $110.3 billion.

a. What was​ GE's market​ capitalization?

What was​ GE's market-to-book​ ratio?

b. What was​ GE's book​ debt-equity ratio?

What was​ GE's market​ debt-equity ratio?

c. What was​ GE's enterprise​ value?

Answer 1

a). - GE's Market​ Capitalization = Market price per share*No of shares Outstanding

= $7.94 per share*8.6 billion shares

GE's Market​ Capitalization = $68.284 billion

- Market-to-Book Ratio = Market​ Capitalization/Total Book Value of Equity

GE's Market-to-Book Ratio = $68.284 billion/$51.7 billion

GE's Market-to-Book Ratio = 1.3208 times

b). - Book Debt-to-Equity ratio = Total Debt/Total Book Value of Equity

= $110.3 billion/$51.7 billion

GE's Book Debt-to-Equity ratio = 2.1335 times

- Market Debt-to-Equity ratio = Total Debt/Market Capitalization

= $110.3 billion/$68.284 billion

GE's Market Debt-to-Equity ratio = 1.6153 times

c). Enterprise value = Market Capitalization + Total Debt - cash & cash Equivalent

Enterprise value = $68.284 billion + $110.3 billion - $68.3 billion

Enterprise value = $110.284 billion

If you need any clarification, you can ask in comments.    

If you like my answer, then please up-vote as it will be motivating