Which One of the Following Statements Is Correct

question 10

Multiple Choice

Which one of the following statements is correct?

• A)The financial market generally reacts the same to a new issue of equity as it does to a new issue of debt as long as the issuer is the same.
• B)Issuing new equity shares is always viewed by the market as a positive event.
• C)Informed managers tend to issue new securities when the existing securities are underpriced.
• D)A decline in the price of existing stock when a new issue is released is a direct cost of selling securities.
• E)A firm's existing shareholders would prefer that new securities be issued when those securities are overpriced rather than underpriced.

Identify the characteristics that define psychological tests, such as standardization and reliability.

Recognize the role of aptitude tests in predicting future performance.

Understand the importance of achievement tests in assessing mastered knowledge.

Grasp the principles of test reliability and validity in psychological testing.