Find the Probability of Correctly Answering the First 5 Questions $\frac { 4 } { 5 }$

question 183

Multiple Choice

Find the probability of correctly answering the first 5 questions on a multiple choice test if random guesses are made and each question has 4 possible answers.

• A) \(\frac { 4 } { 5 }\)
• B) \(\frac { 1 } { 1024 }\)
• C) \(\frac { 1 } { 625 }\)
• D) \(\frac { 5 } { 4 }\)

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Definitions:

Information Content Effect

A market phenomenon where stock prices adjust in response to the news contained in a company announcement, suggesting the news has value for investors’ decisions.

Dividend Payout

The segment of a company's income that is given to shareholders in dividends.

Residual Dividend

A policy whereby a company pays dividends to its shareholders from the residual or leftover equity once all operational and capital expenditure needs are met.

Information Content

The value or significance of a piece of information, especially in terms of its utility in influencing decisions or behaviors in financial markets.