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market capitalization

An investor is considering purchasing one of the following three stocks. Stock X has a market capitalization of ​$7

7 ​billion, pays a relatively high dividend with little increase in​ earnings, and has a​ P/E ratio of 12

12. Stock Y has a market capitalization of ​$62

62 billion but does not currently pay a dividend. Stock Y has a​ P/E ratio of 39

39. Stock​ Z, a housing industry​ company, has a market capitalization of ​$799

799 million and a​ P/E of 18

18.

a. Classify these stocks according to their market capitalizations.

b. Which of the three would you classify as a growth​ stock? Why?

c. Which stock would be most appropriate for an aggressive​ investor?

d. Which stock would be most appropriate for someone seeking a combination of safety and​ earnings?

a. Stock X is classified as a ▼

small-cap

mid-cap

large-cap

stock.  ​(Select from the​ drop-down menu.)

 
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