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Paper eres2003_228:
Individual Tax Rates and Risk-adjusted Discounting

id eres2003_228
authors Nelson, Theron; Smith Steven
year 2003
title Individual Tax Rates and Risk-adjusted Discounting
source 10th European Real Estate Society Conference (10-13 June 2003) Helsinki, Finland
summary The typical procedure for estimating investment value (value to a given investor) of any incomegenerating risky asset (e.g., income-producing real estate) involves basically three steps: First, the investor estimates the stream of cash flows expected to be generated by the asset in the future. Second, the required return to the asset based is derived based on the investorís assessment of the relative non-diversifiable (or systematic) risk associated with the stream of cash flows. This relative risk is due to the co-variability over time between returns realized to the asset and aggregate returns to all risky assets in the entire economy (or market). Finally, the investor computes the present value of the steam of expected cash flows, using the required rate of return as the risk-adjusted discount rate. This present value is the estimate of investment value.
series ERES:conference
email theron.nelson@und.nodak.edu
discussion No discussions. Post discussion ...
ratings
session Session 8, Valuation Methodology 2
last changed 2008/12/29 19:09
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