A valuation that simply capitalizes a forecast of operating income for the next year implicitly assumes that

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A valuation that simply capitalizes a forecast of operating income for the next year implicitly assumes that residual operating income will continue as a perpetuity. Is this correct?

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Financial statements

ISBN: 978-007802531

5th Edition

Authors: Stephen Barrad

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Question Posted: Mar 17, 2012 06:39 AM

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A valuation that simply capitalizes a forecast of operating income for the next year implicitly assumes that

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Yes this is correct The following two valuations are equivalent using a 10 requi...View the full answer

Financial statements

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