If a Stock's Market Price Exceeds Its Intrinsic Value as Seen

question 9

True/False

If a stock's market price exceeds its intrinsic value as seen by the marginal investor, then the investor will sell the stock until its price has fallen down to the level of the investor's estimate of the intrinsic value.

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Definitions:

Supreme Court

The highest judicial court in the United States, with ultimate appellate jurisdiction over all federal and state court cases that involve a point of federal law.

Liberty League

An organization or group advocating for individual freedoms and rights, historically or contemporarily.

New Deal Program

A series of programs, public work projects, financial reforms, and regulations enacted by President Franklin D. Roosevelt in the United States during the 1930s to address the Great Depression.