The correct answer is: C. Modern view
The modern view is a theory of corporate valuation that holds that the value of a company is determined by the present value of its expected future cash flows. This view is in contrast to the traditional view, which holds that the value of a company is determined by its assets and liabilities.
The modern view is based on the idea that the value of a company is determined by its ability to generate cash flows. These cash flows are then discounted to present value using a discount rate that reflects the risk of the company’s cash flows.
The modern view is the most widely accepted theory of corporate valuation. It is used by investors, analysts, and managers to value companies.
The other options are incorrect because:
- Option A, “Dependence hypothesis”, is not a theory of corporate valuation.
- Option B, “Traditional view”, is a theory of corporate valuation that is in contrast to the modern view.
- Option D, “Independence hypothesis”, is not a theory of corporate valuation.