Answered

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What is a reason one discounts future cash flows as part of the absolute valuation process?

a. The company might do a share split which will diminish the value of one's stake
b. Deflation makes future cash flows worthless
c. Investors prefer cash flows today to cash flows in the future
d. Future profits are certain

Sagot :

Answer:

c. Investors prefer cash flows today to cash flows in the future

Explanation:

As we know that the future profits are unpredicted and non-certain so here the investor should prefer the cash flows for today for cash flows to be done in the future. In addition to this, the discount future cash flows should have the part in the absolute valuation process

Therefore the option c is correct

And, the rest of the options are wrong

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