Investors are interested in knowing the intrinsic and market value of a company so that they can make wise investment decisions based on the available information. In determining the monetary value of a business, investors use the following three methods:
Asset approach- this method looks at the liabilities and assets of a business. The difference between the assets and liabilities is the business value.
Market approach-this method is based on the market forces of demand and supply in arriving at an equilibrium price acceptable to both the buyer and the seller of the company. This makes the fair market Continue reading...