Which of the following is a disadvantage of the market approach to valuing a business?
A) Necessary comparisons between publicly traded and privately owned companies
B) Unrepresentative earnings estimates
C) Difficulty in finding similar companies for comparison
D) All of the above

Question

Quizplus · Accepted Answer

The market approach to valuing a business has disadvantages related to finding comparable companies with representative earnings estimates, as well as the necessary comparison between publicly traded and privately owned companies. Therefore, D is the correct answer.

Which of the Following Is a Disadvantage of the Market