Fact Pattern 14-A2 (Questions A5-A6 Apply)

question 11

Multiple Choice

Fact Pattern 14-A2 (Questions A5-A6 apply)
Moore Properties,Inc.,offers in writing to sell to New Development Corporation (NDC) a certain half-acre of land for "$112,000." After New Development signs the offer in acceptance and returns it,Moore discovers that the price should have been stated as "$121,000."
-Refer to Fact Pattern 14-A2.Moore's misstatement of the price is

• A)a bilateral mistake.
• B)a fraudulent misrepresentation.
• C)a unilateral mistake.
• D)unconscionable.

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Definitions:

P/E Ratio

Price-to-earnings ratio, a valuation metric for determining the relative worth of a company's shares by dividing stock price by earnings per share.

Cost of Equity

The return that investors require for investing in a company's equity, reflecting the risk of the investment.

Earnings Per Share

A metric used to determine a portion of a company's profit allocated to each outstanding share of common stock, calculated as net income divided by the number of shares.

Preferred Stock

A class of ownership in a corporation that has a higher claim on its assets and earnings than common stock, often with fixed dividends.