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Posted: January 26th, 2024
Which of the following statements about valuing a firm using the APV approach is most correct?a. The horizon value is calculated by discounting the free cash flows beyond the horizon date and any savings at the cost of debt.b. The horizon value is calculated by discounting the expected earnings at the WACCc. The horizon value is calculated by discounting the free cash flows beyond the horizon date and any tax savings at the WACC.d. The horizon value must always be more than 20 years in the future.e. The horizon value calculated by discounting the free cash flows beyond the horizon date and any tax savings at the levered cost of equity.
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