Choose wisely. There is only one correct answer to each question.
0%
Keep studying!
Review your answers below to learn more.
1.
According to Graham, what are the features of an investment operation?
Thorough analysis, safety of principal, and an adequate return. According to Graham, an investment operation must involve thorough analysis, safety of principal, and an adequate return; otherwise the operation is speculative.
2.
According to Benjamin Graham, an investor should ensure a margin of safety when considering buying a stock.
True. The purpose of the margin is to protect against unforeseen events that could lead to loss.
3.
Which statement would Benjamin Graham most agree with?
"Investing is most intelligent when it is most businesslike." Since stocks represent partial ownership of real businesses, the same behavior that makes sense in the business world makes sense in the stock market.
4.
Which of the following best defines the term "intrinsic value"?
The true worth of a business, which is entirely separate from its stock market price. Intrinsic value is the true worth of a business, which is entirely separate from its stock market price. The intrinsic value of a business is based on its balance sheet net worth and/or future earnings power, not on what participants in the market are willing to pay.
5.
A business's intrinsic value is its stock market price.
False. The intrinsic value is its actual worth, which can be learned from its financial statements.
