Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

7. Receivables and Investments

Introduction to Investments in Securities

Financial Accounting

7. Receivables and Investments

Introduction to Investments in Securities

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Multiple Choice

Why might some investors view a decrease in a company's share price as a positive opportunity?

They can purchase more shares at a lower price, potentially increasing future returns if the price recovers.

A lower share price always means the company is performing better financially.

It guarantees that dividends will increase in the future.

It indicates that the company will soon be acquired at a premium.

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Verified step by step guidance

Understand the concept of share price: A company's share price represents the market value of its stock, which fluctuates based on supply and demand, company performance, and broader market conditions.

Recognize the opportunity in a lower share price: When a company's share price decreases, it may allow investors to purchase more shares for the same amount of money, potentially increasing their ownership stake in the company.

Consider the potential for future returns: If the company's fundamentals are strong and the share price recovers over time, investors who bought shares at a lower price may benefit from capital appreciation, leading to higher returns.

Evaluate the risks: A lower share price does not always indicate a positive opportunity. Investors should analyze the reasons behind the price drop, such as poor financial performance or unfavorable market conditions, to assess the potential risks.

Avoid misconceptions: A lower share price does not guarantee increased dividends, better financial performance, or an imminent acquisition. Investors should base their decisions on thorough research and analysis rather than assumptions.