Question

The price of a share in the pharmaceutical company Moderna, which is developing a vaccine against...

The price of a share in the pharmaceutical company Moderna, which is developing a vaccine against COVID19, went from $ 20 in mid-January to $ 70 today. Which or which of the above variables could have caused this price increase: expected future sale price, dividends expected to be paid by the company, or required performance? justify your answer

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Answer #1

The possible reason would be the expected sales price in future.

This is because if the company becomes successful in developing the vaccine, due to higher demand of pandemic, the profits of the company will increase and thus in search of wealth maximizing returns more investors will invest their funds in company. The market forces of demand and supply will thus increase the price in future

I hope this makes sense

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Took real efforts

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