The Most Established Theory of Stock Prices Relates a Company's

question 165

Multiple Choice

The most established theory of stock prices relates a company's asset prices to the ________.

• A) future value of inflation and interest rates
• B) past earnings of companies and past values of interest rates
• C) future earning prospects of companies and future values of interest rates
• D) future earning prospects of companies and future values of inflation rates

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Definitions:

Drive Theory

A psychological theory suggesting that motivation is a result of biological drives that require satisfaction.

Pull Theories

Theories that propose mechanisms or reasons why people are "pulled" towards certain behaviors or actions, often used in migration studies or motivational psychology.

Expectancy-value Theory

A theory which states that the motivation to engage in a behavior is determined by the expected outcomes and the value of those outcomes to the individual.

Social Needs

Fundamental human needs that pertain to belonging, affection, acceptance, and friendship, which are essential for psychological and social well-being.