Term
| The present value of the venture’s expected future cash flows is called? |
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Definition
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Term
| The value today of all future cash flows discounted to the present at the investor’s required rate of return is called? |
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Definition
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Term
| The value of the venture at the end of the explicit forecast period is called the horizon value, or what? |
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Definition
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Term
| The present value of the terminal value is called? |
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Definition
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Term
| The present value of a set of future flows plus the current undiscounted flow is called? |
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Definition
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Term
| The calculation of equity valuation cash flows nets the cash impact of all other balance sheet and income accounts to focus on the ______ account as the repository of any remaining cash flow. |
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Definition
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Term
| Equity valuation cash flow = Net income plus |
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Definition
| Depreciation and amortization expense minus the change in net working capital plus minus capital expenditures plus net debt issues |
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Term
| The equity valuation method involving explicitly forecasted dividends to provide surplus cash of zero is called? |
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Definition
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Term
| The equity valuation method involving zero explicitly forecasted dividends and an adjustment to working capital to strip surplus cash is called? |
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Definition
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Term
| "Just in time” capital injections by equity investors is a reference to |
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Definition
| equity investors’ providing money only when needed |
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Term
| The maximum dividend method is |
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Definition
| the cleanest for valuation purposes but its dividend-laden financial statements can dramatically understate the firm’s cash position |
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Term
| The pseudo dividend method is |
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Definition
| the cleanest for cash planning, but creates problems valuing the venture by discounting the dividends |
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Term
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Definition
| cash needed to cover a venture’s day-to-day operations |
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Term
| Most discounted cash flow valuations involve using cash flows from an: |
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Definition
| explicit forecast period and a terminal value |
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Term
| Which one of the following equity valuation methods records surplus cash on the balance sheet but assumes that the surplus cash is paid out over time for valuation purposes? |
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Definition
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Term
| When estimating the terminal value of a venture using an equity valuation method, a perpetuity growth equation is often applied that uses the capitalization rate for discounting purposes. This “cap” rate is measured as the: |
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Definition
| equity discount rate minus the perpetuity growth rate |
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Term
| A venture’s going-concern value is the: |
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Definition
| present value of the expected future cash flows |
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Term
| The purpose of the stepping stone year is? |
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Definition
| to assure that there is sufficient required cash |
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Term
| When estimating the terminal value of a cash flow perpetuity, which one of the following is not a component? |
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Definition
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Term
| Which one of the following components is not a component of the equity valuation cash flow? |
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Definition
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Term
| What is the difference between pre-money valuation and post-money valuation? |
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Definition
| amount of money injected by new investors |
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Term
| To calculate a terminal value, one divides the next period’s cash flow by the: |
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Definition
| constant discount rate minus a constant growth rate |
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Term
| The MDM equity valuation method is an abbreviation for: |
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Definition
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Term
| The PDM equity valuation method is an abbreviation for: |
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Definition
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Term
| Which one of the following components is not a component of the equity valuation cash flow calculation? |
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Definition
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