Estimate a Venture's Terminal Value Based on the Following Information

question 30

Multiple Choice

Estimate a venture's terminal value based on the following information: current year's net income = $20,000; next year's expected cash flow = $26,000; constant future growth rate = 7%; and venture investors' required rate of return = 20%.

• A) $156,846
• B) $285,714
• C) $200,000
• D) $150,000
• E) $428,571

---

Definitions:

Aristotelian Approach

A method or philosophy based on the teachings of Aristotle, often emphasizing logical reasoning and empirical evidence.

Ethics

refers to the moral principles that govern a person's behavior or the conducting of an activity.

Consequences

The outcomes or effects that result from a specific action, decision, or event.

Ethical Situations

Scenarios or dilemmas that involve making decisions based on moral principles and values.