Which of the following is not a finding or conclusion of the research study by Ou and Penman that used traditional accounting measures to predict whether a company’s income would increase or decrease?
a. The researchers were unable to describe the following year earnings changes correctly in most cases.
b. Markets are not as efficient as efficient-market advocates would like to believe.
c. Better accounting standards might improve the predictive ability of accounting information.
d. Fundamental analysis is still important for investment purposes.
ANSWER: A
You might also like to view...
The primary role of accounting is to determine the amount of taxes a business will be required to pay to taxing entities
Indicate whether the statement is true or false
Appropriation of retained earnings means that a certain amount of cash has been set aside by the corporation for a specific purpose
Indicate whether the statement is true or false
Taxpayers who change from one accounting period to another must annualize their income for the resulting short period.
Answer the following statement true (T) or false (F)
Simulation is a statistics-based approach used in capital budgeting to get a feel for risk by applying predetermined probability distributions and random numbers to estimate risky outcomes
Indicate whether the statement is true or false