________ requires an estimate of future earnings or cash flows, a sense of the duration of those, and the derivation of an appropriate risk adjusted discount rate.

Question

Quizplus · Accepted Answer

The discounted earnings or cash flows method (DCF) is the best choice because it requires the estimation of future earnings or cash flows, a determination of the duration of those, and the usage of a suitable risk-adjusted discount rate. This technique considers the time value of money, future uncertainties, and the projected stream of cash flows to assess the investment's true worth.

________ Requires an Estimate of Future Earnings or Cash Flows