Stock premium



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if a stock is trading at 30%premium to its book value of Rs 150.What would be the market value of the stock?

1 Answer(s)


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Book Value is Rs.150.
As discussed in the module, market value might be higher or lower than the book value due to various reasons such as - market demand for the stock, macro economic factors etc.
In this case Market Value = Book value + 30% of book value.
The answer should be easy to calculate.