Question

In: Civil Engineering

Which of the following is not one of techniques for financial appraisals?


Which of the following is not one of techniques for financial appraisals?

  1. The market approach that uses prices and other relevant information generated by market transactions involving identical or comparable assets, liabilities, or a group of assets and liabilities. 

  2. The cost approach which reflects the amount that would be required currently to replace the service capacity of an asset. 

  3. The income approach that converts future amounts (such as cash flows or income and expenses) to a single current (discounted) amount. 

  4. The appraisal approach that uses the result of financial appraisal done by experts.

  5. None of the above.

Solutions

Expert Solution

b. The cost approach which reflects the amount that would be required currently to replace the service capacity of an asset.

The known techniques for financial appraisals are

1. Asset Method

2. Income Method

3. Market Comparison Method

4. Goodwill Value


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