Estimating a firm's future cash flows is a fairly straightforward task.

Question

Quizplus · Accepted Answer

Estimating a firm's future cash flows involves analyzing various economic, financial, and market factors that can affect the firm's revenue, expenses, and profitability. This involves making assumptions about future trends and events that may not be certain or easily predictable, such as changes in consumer preferences, competitive landscape, regulatory environment, and macroeconomic conditions. Therefore, estimating future cash flows is a complex and often uncertain task that requires careful analysis and judgement.

Estimating a Firm's Future Cash Flows Is a Fairly Straightforward