Valuation of a Common Stock with No Dividend Growth Potential

question 50

True/False

Valuation of a common stock with no dividend growth potential is treated in the same manner as preferred stock.

---

Definitions:

Near Privity Rule

A legal concept that extends liability for breach of warranty to individuals who may not be in direct contractual relationship but are close enough to the transaction to be considered in "near privity."

Accounting Liability

Financial obligations or debts that a business entity is legally responsible for and are recorded on its balance sheet.

Reasonably Foreseeable Users

Reasonably foreseeable users are individuals or entities that could be expected to use or be affected by a product or information, based on its intended purpose.

Accountant Liability

The legal responsibility accountants have to their clients and third parties, regarding the accuracy of financial statements and audit reports.