Key and some more on Valuation.....

1 B 4 a 7. a
2 D 5 d 8
3. D 6 C 9 a.
10. D 11 a 12 a
13 b 14 b 15 b
16 c 17 c 18 a
19 c 20 a
Tobin's Q:

For example, a low Q (between 0 and 1) means that the cost to replace a firm's assets is
greater than the value of its stock. This implies that the stock is undervalued. Conversely, a
high Q (greater than 1) implies that a firm's stock is more expensive than the replacement
cost of its assets, which implies that the stock is overvalued. This measure of stock valuation
is the driving factor behind investment decisions in Tobin's model.

Enterprise Multiple:

Investors mainly use a company's enterprise multiple to determine whether a company is

undervalued or overvalued. A low ratio indicates that a company might be undervalued, and a
high ratio indicates that the company might be overvalued.

More Explanations:

An enterprise multiple is a ratio used to determine the value of a company. The enterprise
multiple looks at a firm as a potential acquirer would, taking into account the company's debt,
which other multiples like the price-to-earnings (P/E) ratio do not include. The multiple, also
known as the EBITDA multiple, is calculated as:

However, to derive an enterprise multiple, analysts first need to find a company's enterprise
value. The way to calculate enterprise value is as follows: (market capitalization) + (value of
debt) + (minority interest) + (preferred shares) - (cash and cash equivalents). Then, the
enterprise value number is divided by earnings before interest, taxes, depreciation and
amortization (EBITDA), as An enterprise multiple is useful for transnational comparisons
because it ignores the distorting effects of individual countries' taxation policies. It's also used
to find attractive takeover candidates, since enterprise value includes debt and is therefore a
better metric than market cap for mergers and acquisitions (M&A). A company with a low
enterprise multiple can be viewed as a good takeover candidate.
Enterprise Value (The intrinsic absolute value) is calculated using FCFF
approach while relative value takes EBITDA for the following year to multiply
and arrive at the value of the company.