1. What’s the difference between fundamental analysis and technical analysis?  Don’t simply define them both.   2. What’s the difference between the terms “intrinsic value” and “market price?” or in other words, what’s the difference between Value and Price?

Q: For technical analysis, based on patterns of historical prices, to have value, ______ form of market…

A: Weak form efficiency market hypothesis is an element of efficient market hypothesis which states…

Q: What is market value ratio?

A: Ratio is the relation between two different quantities obtained after dividing one by another.

Q: Explain the law of one price in the perspective of the following: a) Purchasing power parity b)…

A: Law of One Price: It is stated in the law of one price that, in the absence of friction between…

Q: What is the difference between the ratios that use the market price and the other ratios? Why might…

A: Ratio analysis mistreatment money statements includes accounting, securities market, and management…

Q: What are the differences between market ordersand limit orders?

A: Market orders might not be executed external of market times or if trading in a specific stock is…

Q: In general it argued that the lower of cost of market rule is supported most closely by which of the…

A: The lower of cost or market rule is related to valuing the inventory, the company should value the…

Q: a. The market value of the comps should be available.   b. The valuation object should be compared…

A: Share valuation is the process of determining the value of the shares based on certain factors.…

Q: Must two assets with the same fundamental characteristics (e.g. same payment stream, same credit…

A: Assets are valued on the basis of profit,cash flow and associated risk.But there value may not be…

Q: Define the law of one price carefully, noting its fundamentals assumptions. Why are these…

A: The question is based on the concept of One price theory used in purchase power parity.

Q: Why are secondary market prices relevant for a firm

A: Secondary market can be defined as the market where securities which have been already issued in the…

Q: Explain how useful the price mechanism is in tackling the basic economic problem?

A: the main role of price mechanism in basic economic problem is allocate scare resources in market…

Q: What is an anomaly to an asset pricing model? For example explain what is pricing anomaly to CAPM…

A: An anomaly is referred when there is a considerable difference between the values computed by using…

Q: Discuss the assumptions, approach, estimation, benefits, limitations, and criticisms of Arbitrage…

A: Arbitrage Pricing Theory is a multi-factor pricing model. Arbitrage Pricing Theory can be used to…

Q: What is fundamental value or price?

A: Fundamental value is a measure of what an asset's worth. This gauge is acquired by methods for an…

Q: FIFO cost of goods sold?

A: Goods available for sale Cost of goods sold + Ending inventory As per LIFO method,   Cost of…

Q: On what concept is the price-earnings multiple valuation approach based?

A: Price earning ratio is computed by dividing the market price of the share by the earnings per share.

Q: Does GAAP distinguish between fair values that are readily determinable from current market prices…

A: Generally Accepted Accounting Principles (GAAP):  A set of accounting principles, practices and…

Q: What does it mean for a market to be “efficient”?

A: The market is efficient in the scenario when the stock price in the present market is not…

Q: Define weak form of market efficiency

A: Efficient Market Hypothesis is a hypothesis that states that the asset prices reflect all available…

Q: What are the three forms of Efficient MArket Hypothesis and what are the criticisms of each from the…

A: The Efficient Market Hypothesis means that the market investors have an entree to all information…

Q: 1. Discuss the following briefly. a. Relative Value Concept b. Value for money Concept c.…

A: Note : As per the guidelines, only first three parts will be solved. Kindly post the last part…

Q: What is market price?

A: The price for the business is the prevailing demand for the purchase or selling of an asset or…

Q: What’s the difference between the terms “intrinsic value” and “market price?” or in other words,…

A: Intrinsic value and market value are both used to value a firm's value. The intrinsic value of a…

Q: What might cause a firm’s intrinsic value to be different from its actualmarket value?

A: Intrinsic Value is one of the vital component used in valuation of a particular company. Intrinsic…

Q: How to incease profitability if PE Ratio, EPS Ratio, and ROE cannot be calculated because of its…

A: Accounting refers to the process of recording, summarizing, interpretation and communicating the…

Q: What is purchasing power parity? Why might purchasing power parity fail to hold?

A: To measure the prices of goods in different countries purchasing parity is used. As per the…

Q: did hedging reduce volatility of the realized price?Answer Yes or No and explain

A: Hedging can be referred as a strategy that is used by the investors to reduce the risk associated…

Q: Why do you think that having a price structure important?

A: Pricing strategies are the methods companies use to price products and services. Almost all…

Q: Purchasing Power Parity (PPP) theory fails to explain the facts. explain whether true or false

A: Buying power parity is a method of comparing the absolute purchasing power of currencies and, to…

Q: Should the bid be lower than the ask for a market maker or a price taker? Explain

A: Market makers are a class of market participants who are willing to buy and sell securities at…

Q: What is market Value added? What is economic value added? What is the difference between what each…

A: Market value added is the amount of wealth that the company is able to create for its stakeholders.…

Q: How can I explain the rationale behind the Arbitrage Pricing Theory (APT) model, and discuss its…

A: The Arbitrage Pricing Theory (APT) model is the asset pricing model that considering the difference…

Q: Which two economic concepts are fundamental to the relevance of fair values to accounting? i. The…

A: The two economic concepts are fundamental to the relevance of fair values to accounting are…

Q: The DPBP is ideal as a stand-alone measure of economic worth. True or False?

A: Discounted Pay-Back Period or DPBP is period in which discounted value of future cash inflows is…

Q: What is the financial meaning of each parameters and variables of the Arbitrage Pricing Theory model

A: The question is based on the concept of Arbitrage Pricing Theory mode (APT). APT is consider  a…

Q: What is a firm’s fundamental value (which is also called it intrinsic value)? What might cause a…

A: Intrinsic value is a degree of what is the worth of the resource or asset. This gauge is…

Q: Briefly explain law of one price with respect to the arbitrage pricing theory.

A: Arbitrage Pricing Theory: It is the multi-factor model that expresses the relationship between…

Q: What is a “required rate of return”? Why is it called the “cost ofmoney” or the “price of money”?

A: The required rate of return can be calculated by two methods, 1) Gordan's growth model  Gordan's…

Q: Explain the following assertion: “Price setting generally requires a balance between market forces…

A: Businesses have to make a lot of decisions in running a business one of which is price setting. They…

Q: In computing the WACC, what is the difference between using the current market value weights rather…

A: WACC A computation of an entity’s cost of capital in which every capital’s category is apportioned…

Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.