QQuestionBusiness Management
QuestionBusiness Management
Investing in mid-cap and large-cap companies means:
A. The companies are typically newer.
B. Anticipating steadier growth over time.
C. Taking a higher risk.
D. Strategizing for high growth potential.
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Answer
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Step 1
First, let's understand the concepts of mid-cap and large-cap companies. \text{Market Capitalization} = \text{Number of Shares Outstanding} imes \text{Price per Share}
Step 2
Now, let's analyze the given options: B. Anticipating steadier growth over time - This is generally true for large-cap companies, which tend to have a more established market position, stable earnings, and less volatile stock prices compared to mid-cap or small-cap companies. C. Taking a higher risk - This is generally true for mid-cap companies, as they may have more growth potential but also more volatility and risk compared to large-cap companies. A. The companies are typically newer - Not necessarily true. Market capitalization is not directly related to the age of a company. Both mid-cap and large-cap companies can include firms of various ages. D. Strategizing for high growth potential - This is generally true for mid-cap companies, which can offer higher growth potential compared to large-cap companies, but with more risk involved.
Final Answer
The options B, C, and D are correct, depending on whether you are investing in large-cap or mid-cap companies.
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