Which of the Following Will Affect Observed Price to Book

question 28

Multiple Choice

Which of the following will affect observed price to book ratio
I. Expected ROCE
II. Business risk
III. Risk free rate of interest
IV. Expected growth

• A) All of the above
• B) II, III and IV
• C) II and IV
• D) I, II and IV

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Definitions:

Net Income

The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue; often referred to as the bottom line.

Transactions

Business activities or exchanges that affect the financial position of a company, involving the transfer of goods, services, money, or titles.

Investing Activities

Financial actions involving the purchase and sale of long-term assets and investments, part of a company's cash flow statement.

Sale of Land

A transaction involving the transfer of ownership of land from one party to another.