题目
题目
单项选择题

One valuation method is the Adjusted Present Value (APV) method. Which statement regarding the APV method is most likely wrong?

选项
A.A. The APV method is appropriate if the amount of debt is not constant over time.
B.B. The tax shield is considered in the unlevered cash flows.
C.C. The APV method splits the entity value of a debt financed firm into the value of a unlevered firm and the present value of the tax shield
D.D. Assuming a constant debt level, the tax shield has the same risk as debt
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标准答案
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思路分析
Examining the APV (Adjusted Present Value) framework and what each statement implies about its mechanics helps identify the incorrect option. Option A: 'The APV method is appropriate if the amount of debt is not constant over time.' In APV, we can value the unlevered (all-equity) firm and then separately add the present value of financing effects such as the tax shield. This approach is particularly convenient when debt levels are changing over t......Login to view full explanation

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