When estimating liquidation value, analysts often make a simplifying assumption that the assets can be sold in an orderly fashion, which is defined as a reasonable amount of time to solicit bids from qualified buyers.

Question

Quizplus · Accepted Answer

This assumption allows analysts to calculate the value of the assets without considering the need for a quick sale, and also assumes that there are qualified buyers willing to purchase the assets at market prices.

When Estimating Liquidation Value, Analysts Often Make a Simplifying Assumption