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Stochastic Discounted Cash Flow

A Theory of the Valuation of Firms

Authors: Kruschwitz, Lutz, Löffler, Andreas

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  • Presents a clear and concise review of firm valuation techniques
  • Includes an overview of the current methods (WACC, APV, TCF, FTE)
  • Offers an up-to-date introduction to the theory of discounted cash flow
  • Open Access
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  • ISBN 978-3-030-37081-7
  • This book is an open access book, you can download it for free on link.springer.com
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  • ISBN 978-3-030-37080-0
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About this book

This open access book discusses firm valuation, which is of interest to economists, particularly those working in finance. Firm valuation comes down to the calculation of the discounted cash flow, often only referred to by its abbreviation, DCF. There are, however, different coexistent versions, which seem to compete against each other, such as entity approaches and equity approaches. Acronyms are often used, such as APV (adjusted present value) or WACC (weighted average cost of capital), two concepts classified as entity approaches.

This book explains why there are several procedures and whether they lead to the same result. It also examines the economic differences between the methods and indicates the various purposes they serve. Further it describes the limits of the procedures and the situations they are best applied to. The problems this book addresses are relevant to theoreticians and practitioners alike.

About the authors

Lutz Kruschwitz is professor emeritus at the chair of banking and finance, the Free University of Berlin. He graduated in economics from this university. His research interests include investment and valuation theory. He is the author of several bestselling German finance textbooks. He received an honorary doctorate from the University of Tuebingen and is an honorary professor at the University of Vienna.

Andreas Löffler studied Mathematics at the Leipzig University and the Academy of Science in Berlin. He obtained his Ph.D. in Mathematics in 1993 and a second Ph.D. in Economics in 1995 from the University of Leipzig . From 2000 he is a tenured professor at the chair of banking and finance at the University of Hannover. Since 2006 he is the chair of banking and finance at Friedrich Alexander University, Erlangen-Nuremberg. In 2008 he moved to Paderborn as a professor of finance and investment.  Since 2011 he holds the chair of finance at the Free University of Berlin.

Table of contents (7 chapters)

Table of contents (7 chapters)
  • Introduction: A Stochastic Approach to Discounted Cash Flow

    Pages 1-5

    Kruschwitz, Lutz (et al.)

  • Basic Elements: Cash Flow, Tax, Expectation, Cost of Capital, Value

    Pages 7-45

    Kruschwitz, Lutz (et al.)

  • Corporate Income Tax: WACC, FTE, TCF, APV

    Pages 47-140

    Kruschwitz, Lutz (et al.)

  • Personal Income Tax

    Pages 141-171

    Kruschwitz, Lutz (et al.)

  • Corporate and Personal Income Tax

    Pages 173-179

    Kruschwitz, Lutz (et al.)

Buy this book

eBook  
  • ISBN 978-3-030-37081-7
  • This book is an open access book, you can download it for free on link.springer.com
Hardcover $59.99
price for USA in USD
  • ISBN 978-3-030-37080-0
  • Free shipping for individuals worldwide
  • Immediate ebook access, if available*, with your print order
  • Usually dispatched within 3 to 5 business days.
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Bibliographic Information

Bibliographic Information
Book Title
Stochastic Discounted Cash Flow
Book Subtitle
A Theory of the Valuation of Firms
Authors
Series Title
Springer Texts in Business and Economics
Copyright
2020
Publisher
Springer International Publishing
Copyright Holder
The Author(s)
eBook ISBN
978-3-030-37081-7
DOI
10.1007/978-3-030-37081-7
Hardcover ISBN
978-3-030-37080-0
Series ISSN
2192-4333
Edition Number
1
Number of Pages
XXIII, 241
Number of Illustrations
24 b/w illustrations
Topics

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