The Efficient Markets Hypothesis Says That

question 49

Multiple Choice

The efficient markets hypothesis says that

• A)only individual investors can make money in the stock market.
• B)it should be easy to find stocks whose price differs from their fundamental value.
• C)stock prices follow a random walk.
• D)All of the above are correct.

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Definitions:

Parametric Counterpart

Refers to statistical tests or models that assume a certain distribution shape for the underlying data, as opposed to non-parametric methods which do not.

Kruskal-Wallis Test

A nonparametric test used to determine if there are statistically significant differences between two or more groups of an independent variable on a continuous or ordinal dependent variable.

P-value

A statistical measure that helps scientists determine the significance of their research results, indicating the probability of observing the results if the null hypothesis is true.

Coffee Shop

A retail establishment that sells coffee, tea, and other beverages, often accompanied by snacks or light meals.