In Theory,all Three Valuation Models,when Correctly Implemented with Internally Consistent

question 51

Multiple Choice

In theory,all three valuation models,when correctly implemented with internally consistent assumptions,will produce the same estimates of value.However,in practice,which of the following errors can result in different value estimates?

• A) Incomplete or inconsistent earnings and cash flow forecasts
• B) Inconsistent estimates of weighted average costs of capital
• C) Incorrect continuing value computations
• D) All of these errors result in different value estimates.

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Definitions:

Ribosomes

Cell organelles that function as the site of protein synthesis, reading the sequence of messenger RNA to create polypeptides and proteins.

Chloroplasts

Organelles found in the cells of green plants and photosynthetic algae, where photosynthesis takes place, converting light energy into chemical energy.

Photosynthesis

The process by which green plants and certain other organisms transform light energy, usually from the sun, into chemical energy stored in glucose.

Rough Endoplasmic Reticulum

A network of membrane-bound tubules and sacs studded with ribosomes, involved in the synthesis and export of proteins.