Stock prices may rise from a reduction in interest rates because:
A. financial market participants are less optimistic about future earnings.
B. stockholders will expect lower future earnings.
C. the present value of future earnings will decrease.
D. consumer and business confidence about future growth improves.
Answer: D
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In Figure 8-5, the firm’s marginal profit at the profit maximizing output level
A. is 10. B. is 35. C. is 0. D. cannot be determined from the diagram.
If the demand is unit elastic, a price cut will leave the quantity demanded unchanged
Indicate whether the statement is true or false
The Royal Proclamation of 1763 and the Quebec Act of 1774 had all of the following effects except:
a. increased the price of farm labor b. increased the price of farm land c. decreased competition for existing farmers d. encouraged Scotch, Irish and German immigrants to rebel against England
Almost all of the rent that tenants pay to landlords of apartments buildings is economic rent
a. True b. False Indicate whether the statement is true or false