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Sir Im confused, some cases the answer consider just debt/capital without reserve, in others it considers the whole capital with reserves.
It depends whether you are asked to use book values or (more likely) market values.
If book values, then the value of equity is share capital plus reserves.
If market values then we do not add the reserves (they are the most obvious reason for the market value being higher in the first place).I do actually mention this in the free lecture 🙂
thanks. I did watch the lecture, but sometime it is not easy to remember everything. thanks once again
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