The intrinsic value of a company$$s stock, also known as its fundamental value, refers to the stock$$s $$true$$ value based on accurate risk and return data. The value perceived by stock market investors determines the market price of a stock.

A stock trading at a price below its intrinsic value is considered to be undervalued. A stock trading at a price above its intrinsic value is considered to be overvalued.

Which of the following statements best describes a marginal investor?

A marginal investor would buy more stock if the price fell slightly, would sell stock if the price rose slightly, and would maintain her current holding unless something were to change.

A marginal investor thinks that the firm$$s stock is priced too high, and she would only buy more stock if the price dropped sharply.

A marginal investor thinks that the firm$$s stock at the current price is a good deal, and she would buy more stock if she had more money to invest.