Asked by Yoselin Ramirez on Apr 29, 2024
Verified
What type of firm is most easily valued using fundamental analysis?
A) public utility
B) social media company
C) new start-up company
D) company in financial distress
Public Utility
A company providing essential services such as water, electricity, and telecommunications to the public, often subject to government regulation.
Fundamental Analysis
An approach to evaluating a security that involves analyzing economic, financial, and other qualitative and quantitative factors.
- Comprehend the reasons and methods behind the variation in financial statement ratios.
Verified Answer
ZK
Zybrea KnightMay 04, 2024
Final Answer :
A
Explanation :
Public utilities often have stable and predictable cash flows, making them easier to value using fundamental analysis compared to companies with less predictable financials, such as social media companies, new start-ups, or companies in financial distress.
Learning Objectives
- Comprehend the reasons and methods behind the variation in financial statement ratios.