A High Price-To-Book Ratio May Indicate Which One of the Following

question 40

Multiple Choice

A high price-to-book ratio may indicate which one of the following?

• A)The firm expanded its plant and equipment in the past few years.
• B)The firm is doing a better job controlling its inventory expense than other related firms.
• C)Investors may believe that this firm has opportunities of earnings a rate of return in excess of the market capitalisation rate.
• D)The firm's P/E ratio is too high.

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Definitions:

Rated Voltage

The maximum safe voltage at which an electrical component can operate without sustaining damage.

Resistive Loads

Electrical components or devices within a circuit that primarily consume energy through resistance.

Wave Forms

Graphical representations of electrical signals, showing the variation of voltage or current over time.

Polarity

Refers to the orientation of magnetic or electrical poles, indicating the direction of magnetic or electrical fields.