Since the salvage value of an asset is uncertain, this value should be discounted using a lower rate than the company's cost of capital

Name: Since the salvage value of an asset is uncertain, this value should be discounted using a lower rate than the company's cost of capital
Brand: Quizplus
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Question

Quizplus · Accepted Answer

The salvage value should be discounted using the company's cost of capital, as it reflects the risk and time value of money associated with the asset.

Since the Salvage Value of an Asset Is Uncertain, This