The Market-To-Book Ratio Is Calculated by

question 56

Multiple Choice

The market-to-book ratio is calculated by

• A) dividing a firm's market value of total equity by the book value of total equity.
• B) dividing a firm's market value of common equity by the book value of total equity.
• C) dividing a firm's market value of common equity by the book value of common equity.
• D) dividing a firm's market value of total equity by the book value of total debt.

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Definitions:

Mutual Fund

An investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments, and other assets.

Deposit

A sum of money placed into an account or given to a party as security for the fulfillment of a contract.

Return

The gain or loss on an investment over a specific period, typically expressed as a percentage of the investment's initial cost.

Annuity

An annuity is a financial product that pays out a fixed stream of payments to an individual, primarily used as an income stream for retirees.