The Adjusted Present Value method (APV) can be regarded as an innovation to the DCF method. The APV method distinguishes between the value of the enterprise and the value of the financing of that enterprise.<\/p>\n
Based on works by \u2018Miller-Modigliani\u2019 it is known that \u2013 although the costs of debt can be considerably lower than the costs of equity, and it thus appears to be attractive to finance an enterprise with as much borrowed money as possible \u2013 the influence of financial \u2018leverage\u2019 in an efficient capital market is limited to fiscal effects. Apart from that, costs for \u2018financial distress\u2019 in a situation in which too high financial \u2018leverage\u2019 is concerned should be taken into account.<\/p>\n
The strength of the APV method is that it makes the value of the business clear, as well as what the value of fiscal & financial engineering is. Both components are valued separately with the APV method.<\/p>\n","protected":false},"excerpt":{"rendered":"
The Adjusted Present Value method (APV) can be regarded as an innovation to the DCF method. The APV method distinguishes between the value of the enterprise and the value of the financing of that enterprise. Based on works by \u2018Miller-Modigliani\u2019 it is known that \u2013 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":6281,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"blog-standaard-old.php","meta":{"footnotes":""},"class_list":["post-6290","page","type-page","status-publish","hentry"],"yoast_head":"\n