In an Efficient Market

question 326

Multiple Choice

In an efficient market:

• A) Prices are constant over the short-term.
• B) Every investment in a security will yield a positive return.
• C) The risk premium on all securities will diminish to zero.
• D) Prices react quickly and correctly to new information.
• E) Future price performance is easy to predict, especially for the short run.

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Definitions:

World Trade Organization

An international organization designed to supervise and liberalize international trade, providing a framework for negotiating trade agreements and a dispute resolution process.

Indigenous Cultures

refers to the customs, practices, languages, values, and world views that are inherited from generation to generation by original inhabitants of regions, distinct from global dominant cultures.

Unethical Business Practices

Unethical business practices encompass behaviors and decisions by individuals or organizations that are dishonest, fraudulent, or otherwise violate ethical standards.

Globalization

The process of increased interconnectedness and interdependence among countries, primarily driven by trade, investment, and technology.