Considering the present value of cash flows valuation model discussed in class, if rates decreased, holding...

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Considering the present value of cash flows valuation model discussed in class, if rates decreased, holding everything else constant, A) would you expect a stock price to increase or decrease, and B) would you expect the price of a growth stock or a value stock to change more? Explain the rationale for both answers. Considering the present value of cash flows valuation model discussed in class, if rates decreased, holding everything else constant, A) would you expect a stock price to increase or decrease, and B) would you expect the price of a growth stock or a value stock to change more? Explain the rationale for both answers.

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Answer A If the discount rate decreases holding everything else constant the stock price would be ex... View the full answer