NACVA CVA Quiz 1 Topic 3 Questions 1-5

Question: 1

Whish of the following factor/s is/are most important for the redemption provisions that affect their value?

ACall price

BWhether or not a sinking fund or some other means of financing the redemption is established

CIssuing company's financial ability to cash out the preferred shares without some sort of redemption fund.

DRedemption methods

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Question: 2

If one assumes that the business will continue indefinitely as a viable going concern after the number of years for which discrete projections were made, the procedure/s commonly used to estimate the terminal value at the end of discrete projection period is/are:

ACapitalization of ongoing economic income

BAn estimated market multiple of the economic income projected for the last year of the discrete projection period

CDiscounted net cash flow available to equity

DPerpetual growth model using net flow available to equity

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Question: 3

The obvious disadvantage of the formal appraisal with regular update is:

ACost

BWastage of time

CComplexity of procedures

DDetailed reports having unnecessary information

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Question: 4

The first step in the valuation process, after carefully defining the assignment, is to gather the data necessary to conduct the assignment. These data can be categorized into three groups. Which one of the following is NOT out of those groups?

ACompany-specific data

BData about the company's industry and economic environment

CData regarding whole supply chain

DData about the subject property's market (market of ownership interests in the subject company)

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Question: 5

____________ is the flip side of discounts, which can be added for a variety of factors, such as control, industry risk, or a swing vote.

APremiums

BCombined discounts

CContingent liability discounts

DBlockage discounts

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NACVA CVA Quiz:1 Topic:3 Questions:1-5