According to the Efficient Markets Hypothesis, Professional Investors Will Earn

question 55

Multiple Choice

According to the efficient markets hypothesis, professional investors will earn:

• A)excess profits over the long-term.
• B)excess profits, but only on short-term investments.
• C)a dollar return equal to the value paid for an investment.
• D)a return that cannot be accurately predicted because investments are subject to the random movements of the markets.
• E)a return that "beats the market."

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Definitions:

Personal Investment

The allocation of personal resources, such as time, money, or effort, towards a specific goal or endeavor.

Rewarding People

The act of providing recognition or compensation to individuals for their contributions, accomplishments, or desired behaviors.

Management Principle

A fundamental truth or guideline that forms the basis for management practices and decision-making in organizations.

Ethical Problem

A situation that requires a person or organization to choose between alternatives that must be evaluated as right (ethical) or wrong (unethical).