The problem with the pure short-term earnings model is that the stock value is highly sensitive to short-term swings in

Question

Quizplus · Accepted Answer

The pure short-term earnings model focuses on maximizing profits in the short-term, which can lead to an overemphasis on meeting quarterly earnings targets and reacting to short-term market fluctuations. This can result in the stock value being highly sensitive to short-term swings.

The Problem with the Pure Short-Term Earnings Model Is That