Some Studies Have Attempted to Determine Whether It Is Possible

question 79

Multiple Choice

Some studies have attempted to determine whether it is possible to predict future returns for a stock based on publicly available quarterly earnings reports.The results of these studies indicate

• A) Stock prices adjust to reflect quarterly earnings reports.
• B) Stock prices do not adjust to reflect quarterly earnings reports.
• C) Support for the semistrong EMH.
• D) Stock prices adjust if earnings reports are released in January.
• E) Stock prices do not adjust if earnings reports are released in January.

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Definitions:

Net Operating Income

The total earnings from a company's operations after deducting operating expenses but before interest and taxes.

Net Operating Income

The profit a company makes after deducting operating expenses from gross profit, not including income and expenses from investments and interest.

Variable Costing

An accounting method that only considers variable costs in determining the cost of products.

Variable Costing

An accounting method that only includes variable production costs (materials, labor, and overhead) in product costs, excluding fixed costs.