Behavioral Finance Argues That

question 15

Multiple Choice

Behavioral finance argues that

• A) even if security prices are wrong, it may be difficult to exploit them.
• B) the failure to uncover successful trading rules or traders cannot be taken as proof of market efficiency.
• C) investors are rational.
• D) even if security prices are wrong, it may be difficult to exploit them and the failure to uncover successful trading rules or traders cannot be taken as proof of market efficiency.
• E) All of the options are correct.

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Definitions:

Square Root

The square root of a number is a value that, when multiplied by itself, gives the original number.

P < 0.05

A statistical threshold indicating that the observed results are significant with a probability of less than 5% being due to chance.

Obtained Value

The actual value measured or computed from a data set or experiment, often compared against a theoretic or critical value in hypothesis testing.

Population Standard Deviation

The population standard deviation is a measure of the dispersion or spread of a set of values within a population, quantifying how much the values differ from the population mean.