If the Stock Market Is Semistrong Efficient, Which of the Following

question 48

Multiple Choice

If the stock market is semistrong efficient, which of the following statements is most correct?

• A) All stocks should have the same expected returns; however, they may have different realized returns.
• B) In equilibrium, stocks and bonds should have the same expected returns.
• C) Investors can outperform the market if they have access to information which has not yet been publicly revealed.
• D) If the stock market has been performing strongly over the past several months, stock prices are more likely to decline than increase over the next several months.
• E) None of the statements above is correct.

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Definitions:

Bipolar Disorder

A psychiatric condition that is identified by significant mood changes, from highly elevated moods (mania or hypomania) to periods of deep depression.

Depression

A common and serious medical illness that negatively affects how you feel, the way you think, and how you act, leading to emotional and physical problems.

Mania

A mental state characterized by extremely elevated mood, energy, and activity levels, often associated with bipolar disorder.

Suicide

The act of intentionally causing one's own death, often driven by despair, mental health disorders, or acute distress.