Investors Are Often Willing to Pay Positive Prices for Shares

Multiple Choice

Investors are often willing to pay positive prices for shares of firms that have never earned a profit because the investors

A) do not know the firms have never earned a profit.
B) expect the firms to have positive net earnings in the future.
C) expect that interest rates will rise in the future.
D) expect that higher rates of inflation will push stock prices higher in the future.