Hi,
I'd have a question on the above lecture: why don’t we have to adjust the interest flows with tax in case of mv calculation? Could you please help me understand? Btw great lecture indeed.:)
Thanks,A
Ask the Tutor ACCA AFM
P4 Q1 December 2014 part 2
10y ago#1The market value is the present value of the future expected receipts to the investor discounted at the investors required rate of return.
The investor is not affected by company tax (and we always ignore personal tax).
I do suggest that you watch the free lectures on the valuation of securities (and if necessary the relevant F9 lectures, because this is revision of F9).
Sign into reply to this topic.