An increase in the sustainable growth rate will cause a(n) ______ in the stock price.

Name: An increase in the sustainable growth rate will cause a(n) ______ in the stock price.
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Question

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An increase in the sustainable growth rate means that the company is expected to grow at a faster rate in the long run, which should increase its future cash flows and earnings potential. This will lead to a higher valuation for the company and a corresponding increase in the stock price.

An Increase in the Sustainable Growth Rate Will Cause A(n)