Why Is the Treatment of a Loan in the SVA

Multiple Choice

Why is the treatment of a loan in the SVA model is consistent with the long-term horizon of SVA?

A) The book value of long-term liabilities is consistently used.
B) Present value of planned future debt financing and a terminal value for estimates outside the planning range are used.
C) The market value of debt used is consistent with the market value of the earnings represented by the discounted FCFs.
D) Loans are assumed to be rolled over in perpetuity.
E) The treatment of loan capital is a weakness as it is not consistent with the long-term horizon of SVA.