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cricket20 [7]
2 years ago
6

A disadvantage of the free cash flow valuation method is A. The free cash flow method is not used widely in practice. B. The ter

minal value tends to dominate the total value in many cases. C. The free cash flow method is not rigorous. D. The projection of free cash flows depends on earnings estimates.
Business
1 answer:
SSSSS [86.1K]2 years ago
7 0

The main disadvantage of the valuation method is that the terminal value tends to dominate the total value in many cases.

In a free cash flow valuation, the intrinsic value equals present value of its free cash flow and thus, the net cash flow is left over for distribution to stockholders and debt-holders in each period.

  • So, the disadvantage of the free cash flow valuation method is that the terminal value tends to dominate the total value in many cases.

Hence, the Option B is correct.

Read more about this here

<em>brainly.com/question/22593826</em>

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Kosher Pickle Company acquires all the outstanding stock of Midwest Produce for $12.5 million. The fair value of Midwest's asset
alukav5142 [94]

Answer:

Amount paid for goodwill=5.3 million

Explanation:

The expression for calculating goodwill is given by;

Goodwill = Consideration paid– Fair value of net identifiable assets

where;

Consideration paid=$12.5 million

Fair value of net identifiable assets=Midwest's assets-Midwest's liabilities

Midwest's assets=$8.5 million

Midwest's liabilities=$1.3 million

Fair value of net identifiable assets=(8.5 M-1.3 M)=7.2 million

Replace in the expression below;

Goodwill = Consideration paid– Fair value of net identifiable assets

Goodwill=12.5 M-7.2 M

Goodwill=5.3 million

5 0
3 years ago
In 2009, the imaginary nation of Viloxia had a population of 5,000 and real GDP of 500,000. In 2010 it had a population of 5,100
Rashid [163]

The correct answer is A. During 2009 real GDP in Viloxia grew by 2 percent, which is about the same as average U.S. growth over the last one-hundred years.

Given that in 2009, the imaginary nation of Viloxia had a population of 5,000 and real GDP of 500,000, and in 2010 it had a population of 5,100 and real GDP of 520,200, to determine the growth of real GDP in Viloxia during 2009, the the following calculations must be made:

  • Total GDP / population = real GDP
  • 500,000 / 5000 = X
  • 100 = X
  • 520,200 / 5100 = X
  • 102 = X
  • 102 - 100 = 2

Therefore, during 2009 Viloxia's GDP grew by 2 percent, which is about the same as average U.S. growth over the last one-hundred years.

Learn more in brainly.com/question/4131508

6 0
2 years ago
Marsha and Antonio make a contract in which Marsha agrees to sell Antonio an expensive and rare piece of art. In the contract, M
kramer

Marsha and Antonio's statements are examples of representations and warranties, as in a contract for the purchase and sale of a work of art there must be agreements that protect and benefit the parties.

<h3 /><h3>Features of a contract</h3>

Corresponds to a formal and consensual document that must be based on legality to identify an economic transaction between two or more parties, establishing the rights and obligations of both.

Therefore, for it to be valid, the parties must be in full capacity and competence, in addition to the need for autonomy of will, the obligation and supremacy of public order.

The correct answer is:

B. Representations and warranties

Find out more information about legal contract here:

brainly.com/question/8935110

5 0
2 years ago
True or False. Since grant proposals need to be short, budget and personnel information should not be included.
Fittoniya [83]
False because is not to be included
6 0
2 years ago
Suppose that in a month the price of movie rentals decreases from​ $3.25 to​ $3. At the same​ time, the quantity of movie rental
Sergeeva-Olga [200]

Answer:

The correct answer is option a.

Explanation:

The initial price of movie rentals is $3.25.

The initial quantity is 100.

The price falls to $3.

This causes demand to rise to 120.

The price elasticity of demand a ratio of change in quantity demanded to change in price level.

The elasticity is calculated at -2.25, through the process given in images.

The price elasticity of demand here is greater than 1 which means it is elastic.

So, option a is the correct answer.

4 0
2 years ago
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