A potential investor can easily ascertain market value of common equity for a given publicly traded firm by looking up the most recent share price (as reported in various online services) and then multiplying this share price times the number of common shares outstanding, as reported on the balance sheet.

Question

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This statement is true. The market value of common equity can be determined by multiplying the most recent share price by the number of common shares outstanding. This information is readily available on the balance sheet and through various online sources.

A Potential Investor Can Easily Ascertain Market Value of Common