Someone Who Is Using Information Outside the Efficient Markets Hypothesis

question 1

Multiple Choice

Someone who is using information outside the efficient markets hypothesis:

• A) has information about the aging U.S. population and expects stock for companies that cater to senior citizens to increase in value.
• B) reads in the newspaper about a merger between two profitable firms and expects the stock prices for these companies to rise.
• C) while auditing a dishonest company realizes that its profit estimates are greatly inflated and immediately sells her stock in the company.
• D) hears a rumor that a top bank may be in trouble and decides to sell his stock in that company.

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Definitions:

Hippocampus

A part of the brain located within the temporal lobe, crucial for memory formation and spatial navigation.

New Memories

New memories refer to the formation of fresh mental representations or recollections of an experience.

Death

The cessation of all biological functions that sustain a living organism.

Blindness

The state of being unable to see as a result of bodily or brain-related causes.