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Based on the dividend-discount model, what do you think would happen to stock prices if there were a decrease in the perceived riskiness of commodities?
Based on the dividend-discount model, what do you think would happen to stock prices if there were a decrease in the perceived riskiness of commodities? If investors perceive commodities are less risky, then the relative riskiness of stocks will rise Stocks would become relatively less attractive, requiring a larger risk premium than + in the risk premium would lead before. From the dividend-discount model, we can see that a rise to a fall in stock prices
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