If the Efficient Market Hypothesis Holds, Investors Should Expect

question 33

Multiple Choice

If the efficient market hypothesis holds, investors should expect
I.to receive a fair price for their security
II.to earn a normal rate of return on their investments
III.to be able to pick stocks that will outperform the market

• A)I only
• B)II only
• C)III only
• D)I and II only

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Definitions:

Motivation-focused Behavior

is action driven primarily by internal or external motivation to achieve a certain outcome.

High Standards

The practice of setting superior performance or quality benchmarks as goals for oneself or others to achieve.

Power Distribution

The way authority and control are allocated among individuals or groups within an organization or society, influencing decision-making and resource allocation.

Formal Authority

The power granted to individuals or positions within an organization officially recognized by titles and duties.