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IrinaK [193]
2 years ago
6

Clever tests to discriminate between alternative explanations. LaPorta, Lakonishok, Shleifer, and Vishny ("Good News for Value S

tocks," Journal of Finance, June 1997) study the returns on stocks on the few days surrounding their quarterly earnings announcements (relative to various expected return benchmarks). They find that on average, high-B/M stocks earn 0.9% around an earnings announcement. In contrast, low-B/M stocks earn an average of -0.1% around an earnings announcement. The difference is statistically significant.
Discuss whether the return pattern found by LaPorta et al. (1997) around earnings announcements is more consistent with the irrational expectations (behavioral) view, or the risk factor (efficient markets) view of the book-to-market effect, and explain your logic.
Business
1 answer:
yulyashka [42]2 years ago
8 0

Answer:

The answer to the above question is:

"The return patterns around earnings announcement is an example of behaviorial pattern exhibiting as more investors flock to buy the stock which has shown better earnings thus driving up the price. In an efficient market, this information would already be built into the price and thus there would not be any appreciable change in price post earning announcement".

Explanation:

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Match each type of insurance with an example of when the insurance
Simora [160]

Answer:

See below

Explanation:

Renter's insurance

Your stereo and computer are stolen from your apartment. Renters insurance is designed to offer protection against loss or damages to properties belonging to renters living in apartments or standalone units.

Liability coverage

You cause an accident that damages someone else's car. Provide financial protection against medical or damages claims against the policyholder if found at fault in an accident.

Health insurance

You go to the emergency room after a car accident. Take care of medical and other hospital-related expenses should the policyholder or their dependents require medical attention.

Disability Insurance

You have to take a month off from work because of a broken leg.  Provide financial compensation against loss of income due to serious bodily injuries to the policyholder.

8 0
2 years ago
Assume the following data concerning a purchase of merchandise by Icon Co. on April 2:
kari74 [83]

Answer:

Correct answer is $4,000

Explanation:

During the purchase on April 2, Icon Co. should recognize the gross amount of $4,000 purchases. Unless it is clearly stated in the problem that Icon Co. uses net method in recording discounts, said discount will be recognized and recorded upon payment of the purchases that falls into the discounted period of contract. Purchase returns will be recognized on the day the company made it.

4 0
3 years ago
Mantle Publications publishes a golf magazine for beginners interested in learning and playing golf. The magazine sells for $4.0
omeli [17]

Answer:

December:

Dr cash         $16,000

Cr subscription revenue   $16,000

Dr cash                         $216,000

Cr unearned revenue                     $216,000

January 2017:

Dr unearned revenue $18,000

Cr subscription revenue            $18,000

Explanation:

The sales of 4000 copies at the newstand means that revenue of $16,000($4*4000) has been earned in December,which means that cash would debited with $16,000 and sales revenue credited with the same amount.

In December,the subscriptions received in advance for 2017 of $216,000($36*6000) would be debited to cash and credited to unearned revenue account.

At the end of January,the unearned revenue would be debited with $18,000($216,000/12) in respect of subscription earned as a result of the Magazine been mailed to subscribers in the month,which now entitles the company to one month subscription as earned sales revenue.

3 0
3 years ago
Explain how<br> Globalization<br>can impact a labor market.​
Romashka-Z-Leto [24]
It’s clearly contributing to increased integration of labor markets and closing the wage gap between workers in advanced and developing economies, especially through the spread of technology. It also plays a part in increasing domestic & income inequality ^^
3 0
3 years ago
Breton Woods Standards were found to be inadequate mainly because?
vodomira [7]

Answer:

A key reason for Bretton Woods' collapse was the inflationary monetary policy that was inappropriate for the key currency country of the system.

Explanation:

The US decision to suspend gold convertibility ended a key aspect of the Bretton Woods system. The remaining part of the System, the adjustable peg disappeared by March 1973.

3 0
2 years ago
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