Assume That a Venture Is Expected to Have an EBITDA

question 38

Multiple Choice

Assume that a venture is expected to have an EBITDA of $1,500,000 at the end of five years from now. If the venture's value is expected to be $12,000,000, what "valuation multiple" was being assumed?

• A) 1 time
• B) 4 times
• C) 8 times
• D) 10 times
• E) 12 times

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Definitions:

Flexible Plastic Hose

A type of hose made from plastic that is designed to be bendable and adaptable to various uses.

Mortgage Foreclosed

The legal process by which a lender obtains a court order to terminate the borrower's right of redemption of the mortgaged property due to failure to meet contractual obligations.

Electrical Wiring

The system of conductors and other devices used to distribute electricity safely in buildings and machinery.

Restrictive Covenant

Clauses in a deed or lease that limit what the owner of the property or tenant can do with the property.