Asked by
Manuel Serrano
on Dec 11, 2024
Verified
Which of the following is true of stock prices?
A) An increase in the interest rate will tend to increase stock prices.
B) A reduction in the interest rate will tend to increase stock prices.
C) An increase in the inflation rate will tend to increase stock prices.
D) There is no reason to believe that changes in interest rates will influence stock prices.
Interest Rate
The percentage of a sum of money charged for its use, typically expressed as an annual percentage rate.
Inflation Rate
The percentage increase in the price level of goods and services in an economy over a period of time.
Stock Prices
The monetary value of a share of a company's equity as traded on a stock exchange.
- Acquire knowledge on the influence of monetary policy and interest rates on the behavior of stock prices and overall market trends.
- Comprehend the relationship between interest rates and the present value of future earnings.
Verified Answer
CR
Learning Objectives
- Acquire knowledge on the influence of monetary policy and interest rates on the behavior of stock prices and overall market trends.
- Comprehend the relationship between interest rates and the present value of future earnings.