Which One of the Following Is True Concerning the Market-To-Book

question 338

Multiple Choice

Which one of the following is true concerning the market-to-book ratio?

• A) Extending the depreciation life of a firm's assets will increase the market-to-book ratio.
• B) A decrease in the price of the stock on the stock exchange will increase the market-to-book ratio.
• C) An increase in the market value of the common stock will increase the market-to-book ratio.
• D) The market-to-book ratio is of most interest to the creditors of a firm.
• E) The market-to-book ratio provides the selling price of a firm's inventory.

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Definitions:

Cycloheptatriene

A cyclic hydrocarbon with seven carbon atoms and three double bonds, known for its interesting reactivity due to aromatic destabilization.

Deprotonated

Refers to a molecule or ion that has lost a hydrogen ion (H+), resulting in a base form.

Resonance Forms

Different structures of a molecule that depict the delocalization of electrons within the molecule, explaining its stability.

Cycloheptatrienyl Cation

A positively charged aromatic species, also known as the tropylium ion, with a seven-carbon ring structure and three double bonds providing aromatic stability.