Stock issued by company have higher rate of return because of

low market to book ratio
high book to market ratio
high market to book ratio
low book to market ratio

The correct answer is: A. low market to book ratio

A low market-to-book ratio indicates that a company’s stock is undervalued by the market. This can be due to a number of factors, such as the company being in a cyclical industry, the company being a turnaround story, or the company being a small-cap stock. When a stock is undervalued, it has the potential to generate higher returns than stocks that are more expensive.

A high market-to-book ratio, on the other hand, indicates that a company’s stock is overvalued by the market. This can be due to a number of factors, such as the company being in a growth industry, the company being a leader in its industry, or the company being a large-cap stock. When a stock is overvalued, it has the potential to generate lower returns than stocks that are less expensive.

Book value is a measure of a company’s assets minus its liabilities. It is a measure of the company’s net worth. Market value is the price of a company’s stock on the stock market. The market-to-book ratio is a measure of how expensive a company’s stock is relative to its book value. A low market-to-book ratio indicates that a company’s stock is undervalued by the market. A high market-to-book ratio indicates that a company’s stock is overvalued by the market.