QUESTIONS 1. Give as many reasons as you can why Jones' initial estimate of the value...

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QUESTIONS 1. Give as many reasons as you can why Jones' initial estimate of the value of the restaurant was inappropriate. 2. Calculate the liquidation value of the business assuming the assets can be sold at 80 percent of book and all debt is paid off at 100 percent of book. 3. Williams and Klein believe that their valuation estimate should reflect competitive managerial wages. Do you agree that this adjustment should be made? Why or why not? 4. Estimate the value of the restaurant in each of the three scenarios in exhibit 2 using the corporate valuation model. Ignore any changes in net working capital. 5. Using the business brokers' rule of thumb, estimate the value of the restaurant. 6. What other methods could be used to calculate a value for the business? 7. Suppose Klein obtains information on three other restaurants that were sold in the last year, and their market to book (MV /BV) ratios were 1, 0.85, and 0.75. How QUESTIONS 1. Give as many reasons as you can why Jones' initial estimate of the value of the restaurant was inappropriate. 2. Calculate the liquidation value of the business assuming the assets can be sold at 80 percent of book and all debt is paid off at 100 percent of book. 3. Williams and Klein believe that their valuation estimate should reflect competitive managerial wages. Do you agree that this adjustment should be made? Why or why not? 4. Estimate the value of the restaurant in each of the three scenarios in exhibit 2 using the corporate valuation model. Ignore any changes in net working capital. 5. Using the business brokers' rule of thumb, estimate the value of the restaurant. 6. What other methods could be used to calculate a value for the business? 7. Suppose Klein obtains information on three other restaurants that were sold in the last year, and their market to book (MV /BV) ratios were 1, 0.85, and 0.75. How