-Concept Statement No. 7introduces an expected cash flow approach that uses a range of cash flows and incorporates the probabilities of those cash flows - first estimate expectedcash flowsand estimate theprobability of those CFs(given) and thendiscount rate ...
At the end of the fifth year, Waldrup's joint venture partner will buy out Waldrup's interest for C$10 million. Waldrup's chief financial officer has estimated that the appropriate discount rate for this proposal is 12 percent. The expected cash flows are given below.Year Cash Flow (C$)...