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Importance of Book Value per Share

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For this question I am not sure, this measure does not provide meaningful information, is it? How can I explain?

Many companies report book value per share which is total equity divided by average shares outstanding. How important is this measure? Does it provide meaningful information? Explain.

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Solution Summary

The importance of book values per share are determined. The measurements for provided meaningful information are examined.

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Dear Student,

Book value per share is important for the following reasons:

1)When the company reaches bankruptcy or liquidation ...

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