Investors should be willing to pay more for a stock when (controlling for all other things):

Question

Quizplus · Accepted Answer

When future interest rates are expected to decrease, the present value of future cash flows from the stock (such as dividends) increases, making the stock more attractive to investors. This is because the discount rate used to calculate the present value of these cash flows is lower, increasing their present value.

Investors Should Be Willing to Pay More for a Stock