Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
How does higher expected growth affect a stock’s value?
Expert Solution
Step 1
Stock value is referred to as the shares of the corporation, which used to appear to trade at the lower price, which is relative to their fundamental like - sales, dividends, earnings, and also appealing to the investor's value. Stock's value used to contrast with the growth in the stock.
Stock's value is defined to be a security trading at the lower price as compared to the performance of the corporation indicates. An investors in stock's value used to attempt to the capitalize on the market inefficiencies as the underlying equity price does not match with the performance of the corporation.
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