what dose “majority owner” or “minority owner” mean here? Thanks. --the ownership perspective in FCFE approach: majority owner --Ownership perspective in dividend discount approach: minority owner
Think back to FSA…majority owner: over 50% equity ownership; minority owner: less than 50% ownership.
As you start acquiring more shares of a company you will have more influence on the firm`s decisions, of example you can influence the dividend policy of the firm. FCFF/FCFE is used. With Minority interest you cannot influence the decisions of the firm. here you use the dividend discount model.
^^ ditto…would’ve been my explanation too…
hw0799 Wrote: ------------------------------------------------------- > what dose “majority owner” or “minority owner” > mean here? Thanks. > > --the ownership perspective in FCFE approach: > majority owner > --Ownership perspective in dividend discount > approach: minority owner this should explain it. coba.belmont.edu/fac/smoliraj/Freecashflow.ppt