Which of the following is true?
A) For most companies the market/book ratio is less than 1.0 because book value is a conservative estimate of what a firm's equity is really worth.
B) For most companies the market/book ratio is greater than 1.0 because the stock market tends to overvalue things.
C) For most companies the market/book ratio is greater than 1.0 because book value is a backward-looking measure based largely on historical costs, whereas market value is forward looking and depends on how investors believe the company will perform in the future.
D) For most companies the market/book ratio is very close to 1.0 because on average, book value provides a good estimate of the market value of a firm's equity.
C) For most companies the market/book ratio is greater than 1.0 because book value is a backward-looking measure based largely on historical costs, whereas market value is forward looking and depends on how investors believe the company will perform in the future.
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A. high-yield advertisement B. dispatch preview C. realistic job preview D. precise advertisement
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Indicate whether the statement is true or false
The principle of diminishing marginal satisfaction helps to explain why people increase their rate of savings as their incomes rise
Indicate whether the statement is true or false.