The Multi-Period Valuation Model is one of the income-based business valuation methods which derives the value of a business entity from cash flows derived from multiple periods. The discounted cash flow method is a good example of the multi-period analysis. To derive the value of a business entity from this discounted cash flow method, the valuer determines the forecast cash flows, including the terminal value, and divides these by the appropriate discount rate to estimate the fair market value of the business entity. The discount rate applied by the valuer is normally weighted average cost of capital which takes into consideration the financial leverage (debt and equity) of the business entity.