ANSWER EACH QUESTION WITH A WORD COUNT OF 175 WORDS!!!
In?finance,?discounted cash flow?(DCF) analysis is a common technique of placing value on a project or company. All of the future?cash flows are projected and?discounted?by using cost of capital to determine their?present values?(PVs). Adding up all future cash flows, both incoming and outgoing, provides the?net present value?(NPV).
1.Give an example of a situation where a building contractor may want to use the discounted cash flow?(DCF) analysis method. 2. Discuss a situation where a method to determine a project’s valuation, other than discounted cash flow?(DCF) analysis, would be favorable.
3. What are the inconveniences of discounted cash flow? How could small changes in input value affect the company?
4. How can real estate development be used as an example in determining how the DCF tool is utilized