The possibility of speculative bubbles in the stock market arises in part because
a. stock prices may not depend at all on psychological factors.
b. fundamental analysis may be the correct way to evaluate the value of stocks.
c. future streams of dividend payments are very hard to estimate.
d. the value of shares of stock depends not only on the future stream of dividend payments but also on the price at which the stock will be sold.
c
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Real GDP per person in both Alpha and Omega is equal to $2,000. Over the next 100 years, real GDP per person grows at a 1.5 percent annual rate in Alpha and at a 2.5 percent annual rate in Omega. After 100 years, real GDP per person in Alpha is ________ smaller than real GDP per person in Omega.
A. $2,000 B. $8,864 C. $5,410 D. $14,763
The subgame-perfect equilibrium of a two-stage game in which firms first choose capacities and then engage in a Bertrand price setting game resembles the equilibrium in:
a. the competitive model. b. the Cournot model. c. the cartel model. d. the price leadership model.
Regulation of industry is usually carried out by special government agencies that administer and interpret the law.
Answer the following statement true (T) or false (F)
In deciding whether to operate in the short run, the firm must be concerned with the relationship between price of the output and
A) total cost. B) average variable cost. C) total fixed cost. D) the number of buyers.