1. An analyst discovers a company with solid earnings but with no prospect of growth. The company could still recommend it as a growth stock:

A)   if the earnings remain solid.

B)   if it is a cyclical stock.

C)   if the market price of the stock is below its intrinsic value.

D)   under no circumstances.

2.Mamford Industries has solid earnings that are projected to grow steadily into the foreseeable future. Which of the following is TRUE?

A)   Mamford is a growth company.

B)   Mamford's stock is considered a growth stock.

C)   Mamford is a growth company and its stock is a growth stock.

D)   Mamford is a cyclical company.

3.Which of the following statements regarding growth companies and growth stocks is TRUE? A growth:

A)   company has management that has the ability to consistently select projects that earn higher returns than required by their risk.

B)   company will not earn below normal returns.

C)   stock is one that has a price that is greater than its intrinsic value.

D)   company will earn above normal returns given its risk.

答案和详解如下：

1. An analyst discovers a company with solid earnings but with no prospect of growth. The company could still recommend it as a growth stock:

A)   if the earnings remain solid.

B)   if it is a cyclical stock.

C)   if the market price of the stock is below its intrinsic value.

D)   under no circumstances.

The correct answer was C)

Whether a stock is a growth stock depends only upon whether its market price is below its intrinsic value. Quality of earnings and type of firm are factors in estimating the intrinsic value, but the primary issue is whether current valuation is such that the stock is expected to grow in value in the future.

2.Mamford Industries has solid earnings that are projected to grow steadily into the foreseeable future. Which of the following is TRUE?

A)   Mamford is a growth company.

B)   Mamford's stock is considered a growth stock.

C)   Mamford is a growth company and its stock is a growth stock.

D)   Mamford is a cyclical company.

The correct answer was A)

Based upon the information, all we can say is that Mamford is a growth company. The stock may be overpriced and not in a position to grow. The problem gives no information concerning the cyclicality of Mamford Industries.

3.Which of the following statements regarding growth companies and growth stocks is TRUE? A growth:

A)   company has management that has the ability to consistently select projects that earn higher returns than required by their risk.

B)   company will not earn below normal returns.

C)   stock is one that has a price that is greater than its intrinsic value.

D)   company will earn above normal returns given its risk.

The correct answer was A)

Growth companies may or may not be growth stocks. 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.