The price of a stock will increase,ceteris paribus,when
A)Future earnings expectations decrease.
B)Consumer confidence increases.
C)The interest rate increases.
D)Terrorists cause people to be fearful.

Question

Quizplus · Accepted Answer

When consumer confidence increases, it indicates that people are more likely to spend money and invest in companies, leading to an increase in demand for stocks and thus driving up the price. The other options all have negative effects on the economy and market, leading to a decrease in demand for stocks and a decrease in price.

The Price of a Stock Will Increase,ceteris Paribus,when