The basis for stock value is the:A) future value of the stock.B) present value of future cash inflowsC) annuity of constant future returnsD) forecasted dividends.

Question

The basis for stock value is the:A) future value of the stock.B) present value of future cash inflowsC) annuity of constant  future returnsD) forecasted dividends.

Shakiera Davis · Accepted Answer

Final Answer : B, Explanation :  The present value of future cash inflows is the most accurate representation of the value of a stock as it takes into account the time value of money and the expected returns from the company's operations. Forecasted dividends may be a factor in determining the present value of future cash flows, but they alone do not determine the value of a stock. The future value of the stock and annuity of constant future returns are not accurate measures of a stock's value as they do not account for the effects of inflation and changes in the market.

The basis for stock value is the:

A) future value of the stock.
B) present value of future cash inflows
C) annuity of constant future returns
D) forecasted dividends.

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