The Estimated Value of a Company Is $18 Million

question 15

Multiple Choice

The estimated value of a company is $18 million. The company has 2 million shares outstanding at a market price of $10 per share. You already own 1,000 shares of the stock. Based on this information, the investment decision rule is:

• A)You should buy more shares of the stock.
• B)You should hold the stock for now.
• C)You should sell the stock.
• D)There is not enough information to make a decision.

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