LOS a: Differentiate between 1) a growth company and a growth stock, 2) a defensive company and a defensive stock, 3) a cyclical company and a cyclical stock, 4) a speculative company and a speculative stock, and 5) a value stock and a growth stock.
Which of the following statements regarding growth companies and growth stocks is TRUE? A growth:
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A) |
company has management that has the ability to consistently select projects that earn higher returns than required by their risk. | |
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B) |
company will earn above normal returns given its risk. | |
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C) |
stock is one that has a price that is greater than its intrinsic value. | |
If the market has identified the company as a growth company and bid up the price, the stock may have below normal returns. The stock price may be more (typically) or less than intrinsic value. | 
发表于 2010-4-23 11:00
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