Busıness Fınance Iı Deneme Sınavı Sorusu #1012619
What is net income approach?
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The model assumes that the cost of debt, the weighted average cost of capital (WACC) and the value of the firm is irrespective of financial leverage. |
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Net operating income is a calculation used to analyze the profitability of real estate investments that generate income. |
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The net income approach is the proportion of debt and equity in which a corporate finances its business. |
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The net income approach advocates that a firm can boost its value by lowering its the weighted average cost of capital (WACC), which is possible by increasing financial leverage in its capital structure. |
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The income approach to measuring gross domestic product (GDP) is based on the accounting reality that all expenditures in an economy should equal the total incomegenerated by the production of all economic goods and services. |
The net income approach advocates that a firm can boost its value by lowering its he weighted average cost of capital-WACC, which is possible by increasing financial leverage in its capital structure. In this approach, it is assumed that the cost of debt is always less than the cost of equity and that the increase in the debt ratio does not lead to a change in the risk perception of the investors.
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