Question

A firm's stock can represent a good investment when _________

A firm's stock can represent a good investment when _________

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

This is a very subjective question and since no options are provided, there can multiple factors on which we can say firm's stock can represent a good investment.

A firm's stock can represent a good investment when company's profits are positive. Positive profits means that company is getting good return on their operations which will boost investor confidence and share price also.

Cash flow is also very important, positive cash flows means that firm has money to invest in profitable investments or to pay to share holders.

LET ME KNOW IF YOU HAVE DOUBTS

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
When referring to an investment involving the acquisition of the voting stock of that company, what...
When referring to an investment involving the acquisition of the voting stock of that company, what are the two method of accounting treatments that can be used to account for that investment?
The overall goal of capital budgeting projects should be to: decrease the firm's reliance on debt....
The overall goal of capital budgeting projects should be to: decrease the firm's reliance on debt. increase the firm's sales. increase the firm's outstanding shares of stock. When a corporation fails, the maximum that can be lost by an individual shareholder is: the amount of their initial investment. the amount of their share of the profits. their proportionate share required to pay the corporation's debts. the amount of their personal wealth. increase the wealth of the firm's shareholders. When the...
Costly Corporation is considering using equity financing. Currently, the firm's stock is selling for $38.00 per...
Costly Corporation is considering using equity financing. Currently, the firm's stock is selling for $38.00 per share. The firm's dividend for next year is expected to be $4.10 with an annual growth rate of 7.0% thereafter indefinitely. If the firm issues new stock, the flotation costs would equal 15.0% of the stock's market value. The firm's marginal tax rate is 40%. What is the firm's cost of external equity? 18.57% 17.79% 18.54% 20.58% 19.69% Marginal Incorporated (MI) has determined that...
11.    A firm's preferred stock pays an annual dividend of $2, and the stock sells for $65....
11.    A firm's preferred stock pays an annual dividend of $2, and the stock sells for $65. Flotation costs for new issuances of preferred stock are 5% of the stock value. What is the after-tax cost of preferred stock if the firm's tax rate is 30%? 12.    A firm's stock is selling for $62. The next annual dividend is expected to be $3.00. The growth rate is 9%. The flotation cost is $5.00. What is the cost of retained earnings? 13.    A firm's...
Which of the following will occur when the capital stock increases? 1 Investment will increase 2...
Which of the following will occur when the capital stock increases? 1 Investment will increase 2 Investment will decrease 3 There will be no change in investment 4 There will be an ambiguous effect on investment
Barbara is considering investing in a stock and is aware that the return on that investment...
Barbara is considering investing in a stock and is aware that the return on that investment is particularly sensitive to how the economy is performing. Her analysis suggests that four states of the economy can affect the return on the investment. Using the table of returns and probabilities below calculate the coefficient of variation for the investment? (Round intermediate calculations and answer to 5 decimal places, e.g. 0.07680.)           Probability     Return Boom     0.4           25.00% Good      0.3          15.00% Level     0.2          10.00%...
Barbara is considering investing in a stock and is aware that the return on that investment...
Barbara is considering investing in a stock and is aware that the return on that investment is particularly sensitive to how the economy is performing. Her analysis suggests that four states of the economy can affect the return on the investment. Using the table of returns and probabilities below calculate the coefficient of variation for the investment? (Round intermediate calculations and answer to 5 decimal places, e.g. 0.07680.) Probability Return Boom 0.4 25.00% Good 0.1 15.00% Level 0.3 10.00% Slump...
A firm's stock is selling for $178.35. The dividend yield is 5%. A 3% growth rate...
A firm's stock is selling for $178.35. The dividend yield is 5%. A 3% growth rate is expected for the common stock. The firm's tax rate is 40%. What is the firm's cost of common equity?
2- When a government restricts the quantity of a good that can be imported into a...
2- When a government restricts the quantity of a good that can be imported into a country, it is imposing: A. Import Quota B. Voluntary Export Quota C. Export Quota D. Voluntary Import Quota
the proportions of the market value of the firm's assets financed via debt, common stock, and...
the proportions of the market value of the firm's assets financed via debt, common stock, and preferred stock are called the firm's
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT