In equilibrium, stock prices are stable and there is no general tendency for people to buy versus to sell and also hold the following conditions: O a The curent market stock price equals its intrinsic value and expected returns must equal required returns. O b. The current market stock price doesn't equal its intrinsic value and expected returns must not equal required returns O c. Expected returns must equal required returns, but current market stock price doesn't equals its intrinsic value. O d. The current market stock price equals its intrinsic value, but expected returns must not equal required returns.
In equilibrium, stock prices are stable and there is no general tendency for people to buy versus to sell and also hold the following conditions: O a The curent market stock price equals its intrinsic value and expected returns must equal required returns. O b. The current market stock price doesn't equal its intrinsic value and expected returns must not equal required returns O c. Expected returns must equal required returns, but current market stock price doesn't equals its intrinsic value. O d. The current market stock price equals its intrinsic value, but expected returns must not equal required returns.
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
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Transcribed Image Text:In equilibrium, stock prices are stable and there is no general tendency for people to
buy versus to sell and also hold the following conditions:
O a. The current market stock price equals its intrinsic value and expected
returns must equal required returns.
O b. The current market stock price doesn't equal its intrinsic value and
expected returns must not equal required returns
O c. Expected returns must equal required returns, but current market stock
price doesn't equals its intrinsic value.
O d. The current market stock price equals its intrinsic value, but expected
returns must not equal required returns.
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