Discounted Cash Flow Methods Are Not Appropriate for Evaluating Mergers

question 37

True/False

Discounted cash flow methods are not appropriate for evaluating mergers because the cash flows are uncertain and the discount rate can only be determined after the merger is consummated.

---

Definitions:

Invasions

The act of entering a place in large numbers, especially when involving a change in the ecosystem by non-native species, or the act of military forces entering another country.

Prairie Pothole Region

An area in North America characterized by thousands of shallow wetlands, significant to North American migratory waterfowl.

Wetlands

Areas of land that are saturated with water, either permanently or seasonally, characterized by distinct ecosystems with specific types of plants and animals.

Interactions

The ways in which organisms, objects, or individuals influence each other within their environment or system, often determining the dynamics of the system.