An individual stock price
A) determines investment spending.
B) mimics the information contained in the stock market index.
C) determines the future performance of the firm.
D) incorporates all news about the firm's future prospects.
E) is inversely related to the interest rate.

Question

Quizplus · Accepted Answer

An individual stock price incorporates all news about the firm's future prospects, which is why it fluctuates constantly based on new information and investor sentiment. However, it does not determine investment spending or necessarily mimic the stock market index, and it is not necessarily directly related to the future performance of the firm or the interest rate.

An Individual Stock Price