Right to say mgmt have indirect influence on instrinic value?

问题如下：

A company's management is most likely able to directly influence the company's:

选项：

A.book value. B.market value. C.intrinsic value.

解释：

Solution

1. Correct because management's decisions directly influence a company's net income, they also directly influence its book value of equity.

2. Incorrect because management actions can only indirectly affect the market value of its equity. The market value of the company's equity reflects the collective and differing expectations of investors concerning the amount, timing, and uncertainty of the company's future cash flows.

3. Incorrect because a company's intrinsic value can only be estimated because it is impossible to predict the amount and timing of its future cash flows. As such, this is not a value that management has direct control over.

Overview of Equity Securities

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