Ways being aware that stock prices fundamentally

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ways, being aware that stock prices, fundamentally, reflect a combination of a company’s expected profits and how investors value those future expectations: a) The debt service component of fixed costs, hence profits. If interest rates increase cost of future borrowing increases net profits decrease stock prices decrease fixed costs increase b) The valuation of future profits via discounting. The value of future profits are lower III What are the beneficial effects of lower oil prices on the macro -economy (i.e., as opposed to their effect on profits of individual oil companies) via: a) Demand for petroleum products is relatively inelastic. So think about the effect on imports, hence aggregate demand. Macro-economy benefits by lower overall prices on gas/oil
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Lower imports = higher aggregate demand b) Lower price of oil is the other side of more supply or availability. What does this mean for potential GDP growth, hence inflation pressure? GDP responds positively to oil prices decreases Decreasing oil prices potential GPD growth increases Inflating pressure brought down since the GDP gap is greater IV Suppose the government decreases the tax rate on household income.
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