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Valuation CY1 > HALO HALONG VALUATION - REVIEW > Flashcards

HALO HALONG VALUATION - REVIEW Flashcards

1
Q

pertains to how much a particular object is worth to a particular set of eyes.

a. Price
b. Value
c. Cost
d. Fundamentals

A

B

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1
Q

According to the CFA Institute, it is the estimation of an asset’s value based on variables perceived to be related to future investment returns, on comparisons with similar assets, or, when relevant, on
estimates of immediate liquidation proceeds

a. Valuation
b. Price Estimation
c. Fundamentals
d. Appraisal

A

A

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2
Q

Valuation places great emphasis on the ___ that are associated in the exercise.

a. Professional judgment
b. Human reasoning
c. Professional Skepticism
d. Due diligence

A

A

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3
Q

The value of a businesses can be basically linked to three major factors, except.

a. Current Operations
b. Future Prospects
c. Embedded Risks
d. None of the above

A

D

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4
Q

One major factor linked to the value of business that shows how is the operating performance of the
firm in the recent year.

a. Current Operations
b. Future Prospects
c. Embedded Risks
d. All of the above

A

A

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5
Q

One major factor linked to the value of business that reflects what is the long-term and strategic decision of the company.

a. Current Operations
b. Future Prospects
c. Embedded Risks
d. All of the above

A

B

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6
Q

One major factor linked to the value of business that shows what are the business risks involved in running the business

a. Current Operations
b. Future Prospects
c. Embedded Risks
d. All of the above

A

C

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7
Q

refers to the value of any asset based on the assumption assuming there is a hypothetically
complete understanding of its investment characteristics

a. Going concern value
b. Liquidation Value
c. Intrinsic Value
d. Fair Market Value

A

C

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8
Q

particularly relevant for companies who are experiencing severe financial distress.

a. Going concern value
b. Liquidation Value
c. Intrinsic Value
d. Fair Market Value

A

B

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9
Q

Value is determined under the going concem assumption.

a. Going concern value
b. Liquidation Value
c. Intrinsic Value
d. Fair Market Value

A

A

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10
Q

The price, expressed in terms of cash equivalents, at which property would change hands between a hypothetical willing and able buyer and a hypothetical willing and able seller, acting at arm’s length in an open and unrestricted market, when neither is under compulsion to buy or sell and when both have reasonable knowledge of the relevant facts.

a. Going concern value
b. Liquidation Value
c. Intrinsic Value
d. Fair Market Value

A

D

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11
Q

The relevance of valuation in ___ largely depends on the investment objectives of the investors or financial managers managing the investment portfolio.

a. Portfolio Management
b. Fundamental Management
c. Financial Management
d. Investment Management

A

A

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12
Q

These are persons who are interested in understanding and measuring the intrinsic value of a firm.

a. Fundamental Analysts
b. Activist Investors
c. Chartists
d. Information Traders

A

A

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13
Q

refer to the characteristics of an entity related to its financial strength, profitability or risk
appetite.

a. Intrinsic Value
b. Fundamentals
c. Technical Characteristics
d. Financial Value

A

B

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14
Q

tend to look for companies with good growth prospects that have poor management.

a. Fundamental Analysts
b. Activist Investors
c. Chartists
d. Information Traders

A

B

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15
Q

They believe that these metrics imply investor psychology and will predict future movements in stock prices

a. Fundamental Analysts
b. Activist Investors
c. Chartists
d. Information Traders

A

C

16
Q

The underlying belief is that _______ are more adept in guessing or getting new information about
firms and they can make predict how the market will react based on this. Hence, _____correlate value
and how information will affect this value

a. Fundamental Analysts
b. Activist Investors
c. Chartists
d. Information Traders

A

D

17
Q

Under portfolio management, the following activities can be performed through the use of valuation techniques, except

a. Stock Selection
b. Deducing Market Expectation
c. Both can be performed
d. None of the above

A

C

18
Q

Separating a segment or component business and transforming this into a separate legal entity
whose ownership will be transferred to shareholders.

a. Mergers
b. Acquisitions
c. Divestiture
d. Spin-off

A

D

19
Q

Sale of a major component or segment of a business (e.g. brand or product line) to another company

a. Mergers
b. Acquisitions
c. Divestiture
d. Spin-off

A

C

20
Q

General term which describes the transaction two companies combined to form a wholly new entity

a. Mergers
b. Acquisitions
c. Divestiture
d. Spin-off

A

A

21
Q

usually has two parties: the buying firm and the selling firm. The buying firm needs to
determine the fair value of the target company prior to offering a bid price. On the other hand, the selling
firm (or sometimes, the target company) should have a sense of its firm value as well to gauge
reasonableness of bid offers.

a. Mergers
b. Acquisitions
c. Divestiture
d. Spin-off

A

B

22
Q

. Acquisition of another business by using significant debt which uses the acquired business as a collateral.

a. Mergers
b. Acquisitions
c. Divestiture
d. Leveraged buy-out

A

D

23
Q

Assumes that the combined value of two firms will be greater than the sum of separate firms.
______ attributable to more efficient operations, cost reductions, increased revenues, combined products/markets or cross-disciplinary talents of the combined organization.

a. Synergy
b. Control
c. Synergy and Control
d. None of the above

A

A

24
Q

deals with prioritizing and distributing financial resources to activities that increases firm
value. The ultimate goal is to maximize the firm value by appropriate planning and implementation of
resources, while balancing profitability and risk appetite.

a. Financial Management
b. Corporate Finance
c. Risk Management
d. Portfolio Management

A

B

25
Q

Generally, the valuation process considers these steps, except

a. Understanding the Business
b. Forecasting Financial Performance
c. Preparing Valuation model based on forecasts
D. All of the above

A

D

26
Q

Which key principles in valuation refers to Business value tend to change every day as transaction
happens?
a. The value of a business is defined only at a specific point in time
b. Value varies based on the ability of business to generate future cash flows
c. Firm value can be impacted by underlying net tangible assets
d. Market dictates the appropriate rate of return for investors

A

A

27
Q

refers to the possible range of values where the real firm value lies.

a. risk of the unknown
b. volatility
c. uncertainty
d. None of the above

A

C

28
Q

Which key principles in valuation refers to Market forces are constantly changing, and they normally
provide guidance of what rate of return should investors expect from different investment vehicles in the
market?

a. The value of a business is defined only at a specific point in time
b. Value varies based on the ability of business to generate future cash flows
c. Firm value can be impacted by underlying net tangible assets
d. Market dictates the appropriate rate of return for investors

A

C

29
Q

The key principles in valuation refers to general concepts for most valuation techniques put emphasis
on future cash flows except for some circumstances where value can be better derived from asset
liquidation is

a. The value of a business is defined only at a specific point in time
b. Value varies based on the ability of business to generate future cash flows
c. Firm value can be impacted by underlying net tangible assets
d. Market dictates the appropriate rate of return for investors

A

A

30
Q
A

Valuation CY1 (1 decks)

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