. If the market value of a firm registers consistent increase, we can reasonably conclude that ________________, (a) Marginal of capital is greater than the cost of capital (b) Tobin’s q measure is greater than 1 (c) Value of its stock is over priced (d) None of the above (e) (a) and (b)

Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter10: Price-searcher Markets With Low Entry Barriers
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1. If the market value of a firm registers consistent increase, we can reasonably conclude that ________________,

(a) Marginal of capital is greater than the cost of capital

(b) Tobin’s q measure is greater than 1

(c) Value of its stock is over priced

(d) None of the above

(e) (a) and (b)

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