Asked by Linda

Why is a company concerned about its stock price in the secondary market?
Answered by Ms. Sue
A company's price on a stock exchange (secondary market) is considered one measure of a company's current profitability. It also reflects investors' expectations for the future. If the price is high and increasing, then the company believes it is doing well and the officers will receive good salaries. They also benefit with their stock options.

Check these sites for more information.

http://www.investopedia.com/ask/answers/06/firmcaresaboutstockprice.asp

http://en.wikipedia.org/wiki/Secondary_market
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