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LOS h: Discuss the role of ownership perspective in valuation. ffice ffice" />
Q1. An ownership perspective can be important for an analyst determining the value of a share position. A block of shares that is large enough to direct the future actions of the firm should receive a:
A) premium for control.
B) a discount for size.
C) premium for block-size.
Correct answer is A)
A share position that is large enough to direct the future actions of a firm should receive a premium for control.
Q2. An ownership perspective can be important for an analyst determining the value of a share position. A discount for lack of marketability would most likely be assigned to a position of shares in which of the following?
A) A non-publicly traded firm.
B) A very large publicly traded firm.
C) A bankrupt firm.
Correct answer is A)
A share position in a non-publicly traded firm would be assigned a discount because it may require a lengthy search to locate willing and able buyers, and they may be only willing to purchase it at a discount.
Q3. An ownership perspective can be important for an analyst determining the value of a share position. A block of shares that is very large in relation to the daily trading volume should receive a:
A) discount for lack of liquidity.
B) premium for block-size.
C) a brokerage discount for volume.
Correct answer is A)
A share position that is very large in relation to the daily trading volume of the shares should be subject to a discount for lack of liquidity as it may take additional time to liquidate the position.
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发表于 2009-3-5 09:34
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