Current cash flow from existing assets is highly relevant to the investor.However,the value of the firm depends primarily upon its growth opportunities.As a result,profit projections from those opportunities are the only relevant future flows with which investors are concerned.

Question

Quizplus · Accepted Answer

While growth opportunities and their profit projections are crucial, investors also consider current cash flows from existing assets, as they provide a basis for evaluating the firm's present financial health and its ability to generate returns in the short term.

Current Cash Flow from Existing Assets Is Highly Relevant to the Investor.However,the