Hello: Q36 On the BSAS is a H-Model quesiton. I get a different answer using the formula than when using the PV chart they provided. Can someone please comment on their approach?
hey DanLieb, I was about to post a question on this, I got 62 when applying the H model rule, I still do not understand how they managed to get ~71… I will post all the odd answers and the stuff that I did not understand according to me within BSAS topic so that we can discuss them… M.
they worded the question poorly. I did the question according to their answers. H-model, aka linear decline, starts after the 4th year. So next 4 years 12% growth. Then apply the H-model.
Malek: I get 62 with the H model as well. I guess the linear decay assumption of the H model does not hold, given their PV factors?
Danlieb, I posted my questions/doubts here: http://www.analystforum.com/phorums/read.php?12,962908 BiPolarBoyBoston is saying that we should apply H Model staring year 4, I do not know how we are supposed to figure it out:) it is not obvious for me 
M.
I got 62 too. 54+8 = 62 by using H-model formula. They have done in pretty weird way…cash flow and PV…I mean WTF
BiPolarBoyBoston Wrote: ------------------------------------------------------- > they worded the question poorly. I did the > question according to their answers. H-model, aka > linear decline, starts after the 4th year. > > So next 4 years 12% growth. Then apply the > H-model. Very good point. Argh 
H-model is a three stage model. Hi growh Linear decay Normal growh. The formula only captures phases 2,3.