In this week's Five Good Questions, we're interviewing Tim Koller about the 7th edition of Valuation. Tim Koller is a core leader of the Corporate Finance Practice at McKinsey. During his more than 28 years of consulting, Tim has served clients globally on value creation, corporate strategy, capital-markets issues, and M&A transactions. Tim is the lead author of Valuation: Measuring and Managing the Value of Companies. This book—now in its seventh edition—has sold more than 800,000 copies. Before joining McKinsey, Tim was a vice president at Stern Stewart & Company, a leading value-based management-advisory firm, where he helped develop key financial-analytical tools and software. He has also lectured at business schools, such as the University of Chicago, Northwestern, Tuck, Yale, and INSEAD. Five Good Questions: 1. Do the growth rates and ROICs of today’s market favorites that are implied by their prices seem justified to produce an attractive future TSR? 2. Will profit margins and returns on capital mean revert after a prolonged period above their historical norms? Are the higher P/Es of today justified? 3. When forecasting the impacts of digitization, how do we factor in competition and pricing with respect to cash flows? (What are the odds of “Winner Take All” vs. “Red Queen Effect” where most of the value flows through to consumer surplus?) 4. What’s the most pervasive and pernicious myth in finance that just won’t die? 5. What’s the most likely mistake a business analyst will make over the next decade?