Discounted Cash Flow (DCF) Method: This method involves projecting the future cash flows of the business and then discounting them back to their present value using a discount rate. The discount rate usually reflects the risk associated with the business and the expected return on investment. Capitalization of Earnings Method: This method involves determining the value of a business based on a single year's earnings, which are then divided by a capitalization rate. The capitalization rate is derived from the required rate of return for investors and the growth rate of the earnings.