The price-to-book value of a company can be shown to be a function of future expected return on common stockholders' equity and risk of equity capital.

Question

Quizplus · Accepted Answer

The price-to-book value of a company is influenced by many factors, including its future expected return on common stockholders' equity and the risk associated with its equity capital. The relationship between these two factors can impact the market's perception of the company's value and, ultimately, its price-to-book ratio.

The Price-To-Book Value of a Company Can Be Shown to Be