Investors Are Willing to Purchase Stocks Having High P/E Ratios

question 19

Multiple Choice

Investors are willing to purchase stocks having high P/E ratios because:

• A) they expect these shares to sell for a lower price.
• B) they expect these shares to offer higher dividend payments.
• C) these shares are accompanied by guaranteed earnings.
• D) they expect these shares to have greater growth opportunities.

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Definitions:

Stereotype Threat

The situational predicament in which individuals are at risk of confirming negative stereotypes about their social group.

System Justification

A theory suggesting that people have a psychological tendency to defend and justify the status quo, even if it is disadvantageous to them, to maintain stability and a sense of legitimacy in society.

Nazi Propaganda

The widespread promotion of Nazi ideology and policies through controlled media and messaging to manipulate public opinion and belief during the Nazi regime in Germany.

Dehumanization

The process of depriving a person or group of positive human qualities, making them seem less than human.