What examples can you think of to show any of these approaches? Sometimes I find that relating a definition to something makes it easier to remember.
Three valuation method alternatives:
-Asset-Based Approaches: They total up all of the investments in the business.
-Earning Value Approaches: They have the idea that a business's true value lies in its ability to produce money in the future.
-Market Value Approaches: It compares the business to similar businesses that have recently sold. This method only works if there are enough similar businesses to compare.
Seong-Rin et al (n.d) applied a life-cycle costing methodology to evaluating the environmental and economic benefit of two different water network systems to evaluate which is the better system. This method was particularly effective in this study as the objective of the authors was to identify the best sustainable solution to implement. By understanding the research and development component versus production they were able to determine the cost of production versus cost of development and evaluate the sustainable production levels for each alternative (Seong-Rin et al n.d). The ability to also identify the cost of replacing or removing the systems once they were obsolete was also included in the calculations, which is an important element of sustainable costing (Seong-Rin et al n.d.). What are your thoughts?