The item that causes the greatest and most immediate effect on a company's stock price will generally be
A)cash on hand.
B)the company's solvency.
C)profits.
D)dependent upon the industry in which the company operates.

Question

Quizplus · Accepted Answer

Profits are typically the primary driver of a company's stock price. When a company's earnings are greater than expected, it demonstrates strong financial health, which can result in an increase in investor confidence and a subsequent rise in the stock price. Conversely, when a company's earnings fall short of expectations, it can lead to a decline in investor confidence and a drop in the stock price. The other options may have an impact on a company's stock price, but they are not typically the primary driver.

The Item That Causes the Greatest and Most Immediate Effect