anonymous
  • anonymous
Hi, Can anyone explain, why in some valuation models the sum of DFCF is divided by (1+ WACC)^(1/2). The reason of doing so is to eliminate the drawbacks of NPV assumption model, where cash flows occurring at the end of each period?
Finance
schrodinger
  • schrodinger
See more answers at brainly.com
At vero eos et accusamus et iusto odio dignissimos ducimus qui blanditiis praesentium voluptatum deleniti atque corrupti quos dolores et quas molestias excepturi sint occaecati cupiditate non provident, similique sunt in culpa qui officia deserunt mollitia animi, id est laborum et dolorum fuga. Et harum quidem rerum facilis est et expedita distinctio. Nam libero tempore, cum soluta nobis est eligendi optio cumque nihil impedit quo minus id quod maxime placeat facere possimus, omnis voluptas assumenda est, omnis dolor repellendus. Itaque earum rerum hic tenetur a sapiente delectus, ut aut reiciendis voluptatibus maiores alias consequatur aut perferendis doloribus asperiores repellat.

Get this expert

answer on brainly

SEE EXPERT ANSWER

Get your free account and access expert answers to this
and thousands of other questions

anonymous
  • anonymous
Just moves all cash flows to midyear cash flows... Nothing to do with NPV model but more a reaction to assuming that all cash flows occur at the end of each year rather than over the course of the year.
anonymous
  • anonymous
Thank you Aswath

Looking for something else?

Not the answer you are looking for? Search for more explanations.