Assignment:
Question 1. Identify and discuss the three underlying issues in the evaluation of a business.
Question 2. Define the term due diligence. How is it applied to the acquisition of an existing venture?
Question 3. Explain how the price/earnings ratio method of valuation works. Give an example.
Question 4. What are the steps involved in using the discounted earnings method? Give an example.
Question 5. Explain why the following are important factors to consider when valuing a business: start-up costs, accuracy of projections, degree of control.
Question 6. What are the potential choices for an entrepreneur to examine as the venture matures?
Question 7. What are three of the contextual aspects that must be considered in an effective succession plan?
Question 8. In what way can forcing events cause the replacement of an owner/manager? Cite three examples.
Question 9. What are five qualities or characteristics successors should possess?
Question 10. What eight steps should be followed to harvest a business? Discuss each of these steps.