The true value of a security is:
A) the value of that security at some future date.
B) the sum of all future income from that security.
C) the amount of funds invested to date in the security.
D) the price that incorporates all currently available information.

Question

Quizplus · Accepted Answer

The true value of a security is the current market price that reflects all available information. This includes factors such as financial statements, economic conditions, industry trends, and other relevant data that can impact the performance of the security. Therefore, option D is the correct answer. Option A is incorrect because it refers to the future value of the security, which may or may not be realized. Option B is incorrect because it assumes that the security provides a constant income stream, which may not necessarily be the case. Option C is incorrect because it only considers the amount invested to date and does not reflect the current market conditions that can affect the value of the security.

The True Value of a Security Is