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Choose the correct answers to fill in Instrinsic value is an estimate of the true value...

Choose the correct answers to fill in

Instrinsic value is an estimate of the true value of the asset. The true value based on the correct accurate OR approximate measurement of the price OR the risks that are involved with that stock or that bond, and the capital gains OR the returns and cash flows that are going to happen in the future. What we can observe are actual intrinsic value OR market prices. The market price of an asset of stock or a bond is the price at which the stock or bond is currently selling. If markets are efficient, if mistakes are not made, market prices and intrinsic value should be the same OR different .

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Answer #1

1. approximate measure

2. the risks

3. returns and the cash flows

4. intrinsic value

5. the same

Instrinsic value is an estimate of the true value of the asset. The true value based on approximate measurement of the risks that are involved with that stock or that bond, and the returns and cash flows that are going to happen in the future. What we can observe are actual intrinsic value. The market price of an asset of stock or a bond is the price at which the stock or bond is currently selling. If markets are efficient, if mistakes are not made, market prices and intrinsic value should be the same

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