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A firm's market-to-book ratio might be greater than 1.0 due to accounting reasons. An example of an accounting reason that would cause the market-to-book ratio to increase is

Respuesta :

Answer: off-balance-sheet assets arising from investments in successful research and development programs that are expensed according to conservative accounting principles.

Explanation:

The market to book ratio refers to the financial valuation metric that is used in the evaluation of the current market value of a company relative to the book value of the company.

It should be noted that there'll be an increase in the market price of a company when there are investments which are made by the company in successful research and development programs which entails the use of the conservative accounting principles.