Economic Appraisal of Managerial Decisions: Consistency of Valuation Model
Abstract
The evaluation of the expected economic returns via financial models is an integral part of the decision-making. We investigate potential sources of errors when applying discounted cash flow model under target leverage assumption and propose modifications to the model, so that consistency could be achieved between the valuation procedure, initial data and underlying assumptions of the forecast.
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Articles of the Russian Management Journal are open access distributed under the terms of the License Agreement with Saint Petersburg State University, which permits to the authors unrestricted distribution and self-archiving free of charge.