To Value a Non-Dividend-Paying Firm, the Terminal Value Used in the Valuation

Multiple Choice

To value a non-dividend-paying firm, the terminal value used in the valuation calculation will most likely be based on a(n) :

A) subjective value determined by the firm's senior managers.
B) salvage value of zero.
C) target ratio.
D) pure play rate of return.
E) expected book value of equity.