In Recent Years the Distinction Between Full-Service Brokers and Discount

question 42

True/False

In recent years the distinction between full-service brokers and discount brokers has become less pronounced as full-service brokers have lowered commissions while discount brokers have begun offering more services.

---

Definitions:

Optimal Size

Optimal size is the most efficient scale of operation for a firm where it can minimize its cost and maximize its profitability.

Synergy

The concept that the combined value and performance of two companies will be greater than the sum of the separate individual parts.

Net Present Value

The difference between the present value of cash inflows and the present value of cash outflows over a period of time, used in capital budgeting to assess the profitability of an investment.

Firm Value

The total market value of a company's equity plus its debt, reflecting the overall worth of the company.