Please I want a perfect answer to these question because many experters did not answer correctly for this questions.

1- What important inputs does Discounted cash flow valuation require and why they are very important?

2- How to estimate a firms weighted average cost of capital (WACC)?

This is the answer of other expert

Answer to Q no 1

The inputs are:

• Net cash flow projections
• Discount rate
• Terminal value or future business sale gain value

For the purposes of the Discounted Cash Flow business valuation, the net cash flow is what the owners can remove from the business without impairing its operation. Assuming that both debt and equity acquisition capital is used, the net cash flow is calculated as follows:

• Net after-tax income.
• Plus depreciation and amortization expenses.
• Plus the after-tax portion of the interest expense.
• Minus capital expenditures. Historic requirements can be found on the companys Statements of Cash Flows.
• Minus increases in working capital.

Answer to Q no 2

The WACC formula is calculated by dividing the market value of the firms equity by the total market value of the companys equity and debt multiplied by the cost of equity multiplied by the market value of the companys debt by the total market value of the companys equity and debt multiplied by the cost of debt times 1 minus the corporate income tax rate.