Question

Adjusted present value is based on the present-day fair value adjusted to reflect the passage of time. true or false?

Answer 1

Answer : False

as

Adjusted present value is the present value which is adjusted to market risk if firm is all financed by the equity or unlevered firm it is calculated by dividing equity beta by the 1+tax adjusted debt beta to equity

In present case adjusted present value is meant for present day fair value adjusted to reflect the passage of time is totally wrong

hence answer here is false

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