Asked by Judie Alfaro on May 28, 2024
Verified
The discounted cash flow technique considers estimated total cash inflows from the investment but not the time value of money.
Discounted Cash Flow
Discounted Cash Flow is a valuation method used to estimate the attractiveness of an investment opportunity, based on projections of future cash flows adjusted for time value of money.
Time Value
The concept that money available at the present time is worth more than the same amount in the future due to its potential earning capacity.
- Acquire knowledge on the strategies and relevance of capital budgeting processes in investment decisions.
Verified Answer
MZ
Maria ZayasMay 28, 2024
Final Answer :
False
Explanation :
The discounted cash flow technique does consider the time value of money by discounting future cash inflows to their present value.
Learning Objectives
- Acquire knowledge on the strategies and relevance of capital budgeting processes in investment decisions.