Summary |
The book explains the rationale behind the technique of discounted cash flow in a lucid manner. The concept of time value of money and cost of capital on which this technique is based have been presented clearly. The problems inherent in the use of this technique, specially the ones relating to estimation of future cash flows are discussed at length. The author also discusses the related issue of valuation of shares, determination of the takeover price of a running concern and valuation of assets etc. All investment decisions invariably entail risk and uncertainty. The author has attempted to show how these can be quantified and reckoned with. In my view, therefore, the book is bound to be of immense use to accountants, economists, project analysts and managers.
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