Hacker News new | ask | show | jobs
by H8crilA 2436 days ago
The future profits only need to be higher than the $5B plus whatever they can get today from liquidating their existing holding. Sunk cost fallacy, or "what is done is done".
1 comments
sicromoft 2436 days ago
Don't forget opportunity cost. The future profits need to be higher than the $5B plus liquidation value, PLUS the expected value of another investment at the margin.
link
H8crilA 2436 days ago
Oh yeah you can use the yield curve to discount future flows, and then demand something extra on top of that (Graham's margin of safety).
link