Which of the Following Is Least Likely to Account for an Excess

question 64

Multiple Choice

Which of the following is least likely to account for an excess of market value over book value of equity?

• A) Inaccurate depreciation methods
• B) High rate of return on assets
• C) The presence of growth opportunities
• D) Valuable off-balance sheet assets

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Definitions:

Federal Laws

Laws passed by the national government of a country, applicable across the entire country, as opposed to state or local laws which only have local jurisdiction.

Federal Regulation

Rules prescribed by federal agencies designed to govern business practices and protect public welfare.

Preempted

The action of precluding or taking precedence over something, often referring to federal laws that take precedence over state laws in the same domain.

State Law

Legislation that is enacted and enforced by a state's legislative body, governing matters not reserved to the federal government by the Constitution.