Firms change the value of an asset or a liability when expected future cash flows change.

Name: Firms change the value of an asset or a liability when expected future cash flows change.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

This is because the value of an asset or a liability is based on the present value of its expected future cash flows. When those expected cash flows change, the present value (or value) of the asset or liability changes as well.

Firms Change the Value of an Asset or a Liability