In the transaction approach, analysts use the information on what someone has paid for a comparable company in a merger or an acquisition to estimate a value for the company.

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The statement is true. The transaction approach involves using data from completed mergers and acquisitions to determine the value of a similar company. It assumes that the value of a company can be estimated based on the price that a buyer is willing to pay for a similar company with similar characteristics.

In the Transaction Approach, Analysts Use the Information on What