Under what circumstances would the most probable selling price of a property and its market value...
Under what circumstances would the most probable selling price of a property and its market value be essentially the same? Under what circumstances might they differ significantly?
Homework Answers
When the market is fully efficient, then selling price of the property and its market value will be same. It means that market value of the assets, will absorb all the historical information, publicly available information and privately held information about the property. It will make the property to be at the same value in the market as it has its selling price. It will cause the property to be at fair value. Here, symmetry of information takes place.
When market is non-efficient and there is asymmetry in information and market is unable to capture and absorb the information, then there will be a difference between selling price and its market value. It will create arbitrage opportunity.
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Under what circumstances would the most probable selling price
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