Which of the Following Statements Is True

question 64

Multiple Choice

Which of the following statements is true?

• A)The market to book ratio shows the degree of discrepancy between the stock market value of an FI's equity and the book value of its equity.
• B)The market to book ratio shows the degree of discrepancy between the stock market value of an FI's assets and the book value of its assets.
• C)The market to book ratio shows the degree of discrepancy between the stock market value of an FI's liabilities and the book value of its liabilities.
• D)None of the listed options are correct.

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Definitions:

LIFO Assumption

A method of inventory valuation where the last items placed into inventory are the first ones to be used or sold.

Inventory Costing Method

A system used to assign costs to inventory and determine the cost of goods sold, examples include FIFO, LIFO, and weighted average.

Declining Prices

A market condition where the prices of goods or services decrease over time, often indicating a surplus or decreased demand.

Net Income

The net income of a business, which is obtained by deducting all costs and taxes from its total revenue.