Question: Why estimating residual value using multiples approach might be a better idea than using growth formula? 0 points possible ( ungraded ) Select the best
Why estimating residual value using multiples approach might be a better idea than using growth formula?
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Residual value calculation using growth formula is very sensitive to the choice of FCF growth rate
Residual value calculation using growth formula is very sensitive to the choice of WACC discount rate
Residual value calculation using growth formula works well for private firms with no comparable firms
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