The market value of common stock is related to its par value because both are sensitive to the reactions of investors to new information.

Question

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The market value of common stock is not related to its par value. The par value represents the minimum value assigned to each share of stock by the company, while the market value is determined by investors in the stock market based on supply and demand, company performance, and other factors. The reaction of investors to new information may affect the market value, but not the par value.

The Market Value of Common Stock Is Related to Its