Interest rates and stock prices move:

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Interest rates and stock prices move:

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Answer 1

Answer #1

Interest Rates and Stock Prices Move IN THE OPPOSITE DIRECTION/INVERSELY

When interest rates ris, stock prices fall and vice versa.

Stock price is calculated by discounting all the future receivables using the opportunity cost i,e the interest rate and hence, when the interest rate rise, discounting factor increase and hence stock prices fall

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Answer 2

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