19. What does the corkscrew relationship mean?

• Debt at the end of one period is expected to be greater than the debt at the start of the next year.
• Takeaways from a buyout model do not depend on information in the DCF model or in the three-statement model.
• Cash flows pay for operations, then senior debt service, then debt service reserves, then returns to the equity investors.
• The value of a variable at the end of one year is related to the value in the next year.

20. Which of the following is NOT an advanced modeling technique?

• Zippers
• Waterfalls
• Corkscrews
• Toggles

21. To calculate terminal value, you multiply the previous year's free cash flow by one plus the __, then divide by the discount rate minus the _____.

• return on assets; growth rate
• growth rate; growth rate
• discount rate; growth rate
• growth rate; market share growth