Companies a and B Are Both in the Same Industry

question 54

Multiple Choice

Companies A and B are both in the same industry and generally compete against each other in the marketplace.Stock A has a P/E ratio of 15 while Stock B's P/E is 21.Which of the following is not true about the relative positioning of Stock A and Stock B?

• A) Stock B has lower perceived risk.
• B) Investor's are willing to pay a higher price for shares in Company B.
• C) Company A business performance is probably not as strong as Company B performance.
• D) All of the statements are correct.

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Definitions:

Two-way ANOVA

A statistical method used to examine the influence of two different categorical independent variables on one continuous dependent variable.

Degrees of Freedom

The total count of distinct values or elements that may be given to a statistical distribution.

Randomized Block Design

An experimental design that groups subjects into blocks to account for variability among them and then randomly assigns treatments within these blocks.

Randomized Block Design

An experimental setup that groups experimental units into blocks to account for variability among them before testing different treatments.