According to James Tobin, the long-run value of Tobin's Q should move toward

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According to James Tobin, the long-run value of Tobin's Q should move toward 1, as this indicates that the market value of a firm's assets is equivalent to their replacement cost. A value of less than 1 suggests that the market may undervalue the firm, while a value of greater than 1 suggests that the market may be overvaluing the firm. Therefore, the goal is for Tobin's Q to approach 1 in the long run.

According to James Tobin, the Long-Run Value of Tobin's Q