Which Statement About Long-Term Investments Is Not True

question 5

Multiple Choice

Which statement about long-term investments is not true?

• A)They will be held for more than one year.
• B)They are not currently used in the operation of the business.
• C)They include investments in stock of other companies and land held for future use.
• D)They do not include long-term notes receivable.

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Definitions:

Intrinsic Value

The actual, fundamental worth of an asset or investment, determined through financial analysis independent of current market value.

Time Value

The concept that money available now is worth more than an identical sum in the future due to its potential earning capacity.

Strike Price

The predetermined price at which the holder of an option can buy (call) or sell (put) the underlying asset.

Market Price

The current price at which an asset or service can be bought or sold.