According to Fundamental Analysis,a Saver Should Prefer to Buy Stocks

question 39

Multiple Choice

According to fundamental analysis,a saver should prefer to buy stocks that are

• A)undervalued.This means the price of the stock is low given the value of the corporation.
• B)undervalued.This means the value of the corporation is low given the price of stock.
• C)overvalued.This means the price of the stock is high given the value of the corporation.
• D)overvalued.This means the value of the corporation is high given the price of stock.

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Definitions:

Risk Averter

An individual or entity that prefers to avoid risk, choosing options that have a more certain outcome even if it potentially means receiving lower returns.

Variance

A measure of dispersion that shows how much the values in a set differ from the mean or expected value.

Expected Utility Maximizer

A theoretical concept in economics and decision theory where an individual chooses among risky options by selecting the option with the highest expected utility.

Event

An occurrence or happening, often of significance and usually a distinct piece of time.