Abstract
The article provides information on the study concerning the U.S. corporate valuation litigation by using the discounted cash flow (DCF) analysis. An inherent tautology exists in the use of DCF analysis, It is demonstrated that the tautology could be explained by an inherent assumption in the DCF analysis that a firm continuously rebalances its debt. It suggests that the true value of the typical firm lies somewhere between that determined under each of the extreme assumptions, continuous rebalancing, or no rebalancing at all.
| Original language | English |
|---|---|
| Pages (from-to) | 31-48 |
| Number of pages | 18 |
| Journal | Journal of Forensic Economics |
| Volume | 20 |
| Issue number | 1 |
| State | Published - 1 Jan 2007 |
| Externally published | Yes |
Keywords
- Discounted cash flow
- Corporate finance
- Corporate accounting
- Liquidity (Economics)
- Capital investments
- Capital costs
- Financial management
- Cash flow
- United States