Which of the following is true about the change in a stock price?
A. If investors demand higher returns to invest in stocks, then stock prices should increase.
B. If investors demand lower returns to invest in stocks, then stock prices should fall.
C. If investors demand higher returns to invest in stocks, then stock prices should fall.
D. If investors expect their investments to generate lower future cash flows, then stock prices should increase.
E. If investors expect their investments to generate higher future cash flows, then stock prices should fall.
Answer: C
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