What was the change in Global's book value of equity from

2018

to

2019

according to Table 2.1

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? Does this imply that the market price of Global's shares increased in

2019?

Explain.

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Part 1

What was the change in Global's book value of equity from

2018

to

2019?

Global's book value of equity changed by

$enter your response here

million from

2018

to

2019.

(Round to one decimal place.)

Part 2

Does this imply that the market price of Global's shares increased in

2019?

Explain.(Select all the choices that apply.)

A.

There are many events that may affect Global's future profitability, and hence its share price, that do not show up on the balance sheet.

B.

An increase in book value necessarily indicates an increase in Global's share price. The book value of the equity does not go up unless the share price goes up.

C.

The market value of a stock does not depend on the historical cost of the firm's assets, but on investors' expectation of the firm's future performance.

D.

An increase in book value does not necessarily indicate an increase in Global's share price.

Global Corporation Balance Sheet for 2019 and 2018 ($ millions)
Assets	2019	2018			Liabilities and Stockholders' Equity	2019	2018
Current Assets					Current Liabilities
Cash	23.2	20.5			Accounts payable	29.2	26.5
Accounts receivable	18.5	13.2			Notes payable/short-term debt	5.5	3.2
Inventories	15.3	14.3			Total current liabilities	34.7	29.7
Total current assets	57.0	48.0			Long-Term Liabilities
Long-Term Assets					Long-term debt	113.2	78.0
Net property, plant, and equipment	113.1	80.9			Total long-term liabilities	113.2	78.0
Total long-term assets	113.1	80.9			Total Liabilities	147.9	107.7
					Stockholders' Equity
					Common stock and paid-in surplus	8.0	8.0
					Retained earnings	14.2	13.2
					Total Stockholders' Equity	22.2	21.2
Total Assets	170.1	128.9			Total Liabilities and Stockholders' Equity	170.1	128.9