Question

If someone deliberately understates costs and thereby increases profits, this can cause the stock price to rise above its intrinsic value. the stock price will probably fall in the future. also, those who participated in the fraud can be prosecuted, and the firm itself can be penalized.

a. True
b. False

Answer 1

True

Step-by-step explanation:

The key word here is deliberately.

Answer 2

True,Because all contracts are signed under the terms and conditions apply such policies like utmost good faith were all information should be provided and should be true