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Income Method

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Created on October 14, 2022

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Transcript

Income approach Method

ANDRES SILVA

Group 212032_8 October 2022

DEFINITION OF CONCEPT

the income method values the intellectual property as the present value of the economic benefits of the project also known as cash flow methoddiscounted, seeks to evaluate the potential of the business project towards the future. This methodology assumes that the cash flows include the benefits of the project and that, consequently, the higher margins

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related processes and mathematical formulas

we must analyze the inflows and outflows of money from the company over a period. In a simple way, we can say that the discount rate reflects the financial devaluation of each period, the next thing is to bring all flows to present value based on discount rate DCF = revenue projections / 1 + discount rate raised to the number of periods

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How can companies create value from their innovation?

Discounted cash flow is an extraordinarily interesting indicator in the financial environment, as it allows managers, entrepreneurs and investors to know the true value of an investment, asset or company at the time of calculation.