Which of the Following Is Not an Assumption Made by Technical

question 5

Multiple Choice

Which of the following is not an assumption made by technical analysts?

• A) Changes in trend are caused by shifts in supply and demand relationships.
• B) Stock price movements are independent of one another.
• C) Security prices tend to move in trends.
• D) Supply and demand of securities are determined by various factors.

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Definitions:

Business Risk

The exposure a company or investor has due to uncertainties in the operating environment, including market demand, supply costs, and competition.

Financial Risk

The probability of loss inherent in financial operations, such as changes in market prices, interest rates, or credit quality.

Break Even

The point at which total costs and total revenue are equal, resulting in no net loss or gain from business activities.

Authors' Royalties

Authors' royalties are payments made to authors from publishers or producers, based on a percentage of sales of their work.