Which Statement Is Correct

question 66

Multiple Choice

Which statement is correct?

• A) When stock prices barely change for a while, they are said to be stuck in a "bubble."
• B) Bubbles can result when prices rise rapidly and investors join the game on the assumption that prices will continue to rise.
• C) Most bubbles with hindsight can be justified by the improved fundamentals.
• D) "Bubbles" is another term for stocks in high-tech industries.

---

Definitions:

Marketability

The ease with which a product or service can be sold in the market based on demand and supply conditions.

Solvency

The ability of a company to meet its long-term financial obligations and continue its operations into the foreseeable future.

Financial Statement Data

The quantitative information derived from a company's financial statements, depicting its financial performance, position, and cash flows over a period.

Ratio Analysis

A financial analysis technique that uses ratios derived from financial statements to assess a company's performance and financial health.