Which one of the following announcements is most apt to cause the price of a firm's stock to increase?
A)The firm met its quarterly earnings forecast.
B)An unpopular CEO unexpectedly announced he is resigning effective immediately.
C)A firm officially confirmed the rumors that it is merging with a competitor.
D)The firm just lowered its projected earnings per share for next year.
E)Analysts are expected to lower the firm's credit rating on its debt.

Question

Quizplus · Accepted Answer

The announcement of an unpopular CEO's resignation is likely to be seen as a positive development for the firm and could increase investor confidence, leading to an increase in the stock price. The other options are likely to have a negative impact on the firm's stock price.

Which One of the Following Announcements Is Most Apt to Cause