If a Stock's Expected Return as Seen by the Marginal

question 5

True/False

If a stock's expected return as seen by the marginal investor exceeds this investor's required return, then the investor will buy the stock until its price has risen enough to bring the expected return down to equal the required return.

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Definitions:

Dividends Accounts

Dividends Accounts represent the financial accounts used by a company to record the dividends paid out to shareholders, reflecting the distribution of earnings.

Liabilities

Liabilities are financial obligations or debts that a company owes to others, which must be settled over time through the transfer of money, goods, or services.

Debit

A bookkeeping entry that triggers an increment in assets or a decrement in liabilities on a corporation's financial statement.

Accounts Receivable

Funds that are due to a company from its customers for goods or services delivered on credit.