Which of the Following Statements Is Most Correct

question 86

Multiple Choice

Which of the following statements is most correct?

• A) If a market is strong-form efficient this implies that the returns on bonds and stocks should be identical.
• B) If a market is weak-form efficient this implies that all public information is rapidly incorporated into market prices.
• C) If your uncle earns a return higher than the overall stock market, this means the stock market is inefficient.
• D) Both answers a and b are correct.
• E) None of the above answers is correct.

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Definitions:

Matures

The point in time when a financial instrument, such as a bond, CD, or loan, reaches its final due date and the principal is to be repaid.

Paying

The act of disbursing or settling a financial obligation.

Term Deposit

A type of bank deposit that is held at a financial institution for a fixed term or period of time, often yielding higher interest rates.

Matures

Refers to the final payment date of a financial instrument at which point the principal (and all remaining interest) is due to be paid.