The value of a firm's stock is more likely to increase when its profits are growing.

Name: The value of a firm's stock is more likely to increase when its profits are growing.
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Question

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The growth in profits of a firm is positively correlated with the value of its stock. As profits grow, investors become more optimistic about the future prospects of the company, leading to an increase in demand for the firm's stock, which in turn drives its price up.

The Value of a Firm's Stock Is More Likely to Increase