Suppose the government proposes a relief package in an urgent attempt to bail out virtually all industries across the board and offset the economic damage unleashed by the 3-month long coronavirus [COVID−19] crisis episode, and indeed, keeps its promise.

 

Required: 

By approximately what factor [in the long-run] are businesses likely to discount their negative cash flows, to work out how much is needed to level their current losses?

 

Further Instructions:

• Generally, I expect to see ‘some kind’ of formula or general rule, without much emphasis on quantitative values.
• 
  
• Remember, this is an essay question, so, please feel free to express yourself as you please

Answer rating: 100% (QA)

Businesses can discount the negative effect of the coronavirus in these 3 months by redefining thei... View the full answer