contestada

Which of the following factors does not affect the initial market price of a stock?

(A) The company's anticipated future earnings.
(B) The current state of the economy.
(C) The par value of the stock.
(D) The expected dividend rate per share.

Respuesta :

zunesyed

Answer:

The correct answer is (C)

Explanation:

Generally the common stocks worth per share is normally a limited quantity, for example, $0.05 or $0.01 and it has no association with the market estimation of the price of stock. The standard worth is once in a while referred to as the regular stocks.  The par value has no connection with the price of the stock.

Initial Market Price or Initial Public Offering is the price equal to the value of the expected dividend in the future and the fluctuation of supply and demand.

Which factor does affect the initial market price of stock?

  • The fundamental factors like level of earning, cash flow per share, dividends per share, and the expected growth in the earning affect the initial price of the stock.

  • A growing economy leads to greater confidence in investors and helps in the rise of the stock market. The country's economy affects the price of stocks.

  • The par value of the stock is defined as the initial face value of the company's shares that are announced or decided by the directors as per the guidelines and the total value of the fund to be issued.

Thus, the par value does not affect the initial price of the stock.

The correct answer is C.

Learn more about the initial market price here:

https://brainly.com/question/14030517

Otras preguntas