Which Form of the Efficient Market Hypothesis Implies That Security

question 24

Multiple Choice

Which form of the efficient market hypothesis implies that security prices reflect only information contained in past prices?

• A)Weak form
• B)Semistrong form
• C)Strong form
• D)Hard form
• E)Past form

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Definitions:

Equilibrium

A state in which market supply and demand balance each other, resulting in stable prices and quantities.

Efficient

Refers to a level of performance that uses the least amount of inputs to achieve the highest amount of output.

Utility Possibilities Frontier

A curve that shows the maximum feasible amount of two goods that can be produced with available resources and technology, indicating the trade-offs and efficiency in production.

Utility

In economics, utility refers to the satisfaction or pleasure derived by consumers from consuming goods or services.