Which of the Following Most Likely Explains Why a Corporation's

question 35

Multiple Choice

Which of the following most likely explains why a corporation's stock trades at a very high price-earnings ratio?

• A) Investors expect the corporation to have higher earnings in the future.
• B) The corporation pays a very low dividend on its stock.
• C) The corporation has several classes of stock outstanding.
• D) The corporation is large with very low risk.

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Definitions:

Semantic Memory

A type of long-term memory involving the capacity to recall words, concepts, or numbers, which is essential for the understanding of language and ideas.

Episodic Memory

Episodic memory enables individuals to recall personal experiences and specific events, including the context and the associated emotions.

Cerebellum

Part of the brain that plays important roles in motor control, and it may also be involved in some cognitive functions such as attention and language.

Phonological Loops

A component of the working memory model that deals with auditory information processing and verbal information storage.