Nitya K.

asked • 06/23/20

Using the Ad/AS model, explain why stock prices rise when there's talk of a vaccine for Covid-19

Using the Ad/AS model, explain why stock prices rise when there's talk of a vaccine for Covid-19 and they fall when the number of cases spikes higher. Hint: stock prices are not a variable in our model, but they do reflect the future profitability of US companies. Remember too that most American-made products are consumed domestically.

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