The value of a stock should increase if investors' required rate of return declines.

Question

The value of a stock should increase if investors' required rate of return declines.​

Quizplus · Accepted Answer

When investors' required rate of return declines, it means they are willing to accept a lower return for the same level of risk. This makes the stock more attractive to investors, leading to an increase in demand for the stock, and consequently, an increase in its price. Thus, the value of a stock should increase if investors' required rate of return declines.

The Value of a Stock Should Increase If Investors' Required