hard · Investment Banking implied-share-price

A firm's share price is 50.00. It has 10 million options outstanding with an exercise price of60.00.

How are these options treated in the calculation of Equity Value?

  1. They are included using the Treasury Stock Method.
  2. They are excluded from the calculation.
  3. They are treated as debt and added to Enterprise Value.
  4. The 10 million shares are added to the basic share count.

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