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Notices
JD
Jimmy Dotiwala (not verified)
22nd June 2012 | 4:50am

Hello David, this is a good article. I think the important factor that contributes to the noise in a DCF model is the need to forecast in perpetuity. Though this practice agrees with the accounting principle of going concern, it simply is at variance with the physical law that resources are limited. Despite of all the care in estimating inputs described, it is difficult to reconcile the model with intuitiveness.