Which of the following is the value- creation metric that simplifies discounted cash flow analysis by employing (Rappaport's) seven value drivers?
A) Discounted cash flow
B) Total shareholder return
C) Shareholder value analysis
D) Economic profit

Question

Quizplus · Accepted Answer

Shareholder value analysis simplifies discounted cash flow analysis by using Rappaport's seven value drivers, which include sales growth, operating margin, capital turnover, working capital investment, fixed capital investment, cost of capital, and sales-to-capital ratio. It measures the value created for shareholders by analyzing the impact of these drivers on the company's future cash flows.

Which of the Following Is the Value- Creation Metric That