The Valuation of Common Stock Is Considerably More Complicated Than

question 74

Multiple Choice

The valuation of common stock is considerably more complicated than the valuation of bonds or preferred stocks because:

• A)The returns can take two forms, i.e.annual cash payments and price appreciation
• B)Common stock dividends are normally expected to grow and not remain constant
• C)The returns from common stocks are generally larger and more certain than the returns from bonds and preferred stocks
• D)The returns can be in annual cash payments or price appreciation, and they are normally expected to grow and not remain constant

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Definitions:

Repatriation

The process of returning individuals to their home country or the return of assets to their country of origin.

Cross-Cultural Adjustment

The process individuals undergo to adapt to new cultural environments and norms.

Global Assignments

Refers to work tasks assigned to employees that require them to relocate internationally for a period of time.

MNC

A multinational corporation, which is a company that operates in multiple countries beyond its original country of incorporation.