Two Conditions Are Used to Determine Whether or Not a Stock

question 48

True/False

Two conditions are used to determine whether or not a stock is in equilibrium: (1) Does the stock's market price equal its intrinsic value as seen by the marginal investor, and (2) does the expected return on the stock as seen by the marginal investor equal this investor's required return? If either of these conditions, but not necessarily both, holds, then the stock is said to be in equilibrium.

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Definitions:

Self Defence

The right to prevent harm to oneself by using reasonable force, as permitted under the law.

Battery

Unwelcome physical contact; deliberate, non-consensual physical interference to someone’s body.

Assault

A deliberate verbal or physical threat; an action that makes a person fear physical interference.

False Imprisonment

Holding people against their will and without lawful authority.