Explain How Valuations Can Differ Between Public and Private Companies

question 35

Essay

Explain how valuations can differ between public and private companies and between young and mature companies as well as the importance of marketability, control, and key person considerations in valuation.

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Definitions:

Buyer Tastes

Preferences and inclinations of consumers that influence their purchasing behavior.

Close Substitutes

Goods or services that can easily replace each other in consumption, affecting consumer choice and market competition.

Quantity Demanded

The aggregate quantity of a product or service that buyers are prepared to buy at a given price point.

Quantity Demanded

The total amount of a good or service that consumers are willing and able to purchase at a specific price level and at a given time.