Which of the following is inconsistent with a firm that sells for very near book value?
A)low current earning power
B)no intangible assets
C)high future earning power
D)low, unstable dividend payment

Question

Quizplus · Accepted Answer

If a firm is selling for very near book value, it means investors are valuing the firm primarily based on the net value of its assets. High future earning power would indicate that the firm has the potential to generate significant profits in the future, which would increase its market value above its book value. Therefore, high future earning power is inconsistent with a firm selling for very near book value. The other options are consistent with a firm selling for near book value.

Which of the Following Is Inconsistent with a Firm That