The Most Significant Determinant of a Share Price Is a Company's

question 10

Multiple Choice

The most significant determinant of a share price is a company's:

• A) beta
• B) net profit
• C) capacity to pay future dividends
• D) book-to-market ratio

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Definitions:

Collusion

A non-competitive, secret agreement between rivals to limit competition, set prices, or control market shares.

Four-Firm Sales Concentration Ratio

The percentage of total industrial sales accounted for by the four largest firms within a specific market, used to measure the degree of market concentration.

Geographic Concentration

The phenomenon of economic activity or specific industries clustering in specific regions or areas.

X-Inefficiency

Occurs when a firm fails to utilize its resources efficiently, due to factors like lack of competitive pressure or managerial inefficiencies.