Equity Investments Q171

0. Which of the following statements most likely corrrect?

A
Management can directly influence both the book value and market value of the company.
B
Decrease in book value will automatically cause a company’s market value to decrease.
C
A change in investors’ expectations can impact a company’s market value.

Answer
Comment
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Option : C
Explanation : A change in investors’ expectations can impact a company’s market value. Management can directly influence the book value of a company but not the market value. A decrease in book value will not necessarily cause the market value to decrease.

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