Which of the Following Is NOT Correct About Market Efficiency

question 125

Multiple Choice

Which of the following is NOT correct about market efficiency?

• A) The EMH says that actual capital markets, such as the TSX, are efficient.
• B) Strong form efficiency says all information of any kind is reflected in stock prices.
• C) Semi-strong form efficiency says all public and private information is reflected in stock prices.
• D) Weak form efficiency says studying past prices in an attempt to identify mispriced stocks is futile.
• E) The price a firm obtains when it sells its stock in an efficient market is a fair price, in the sense that the price reflects available information about the stock.

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Definitions:

Fugue State

A rare psychological state involving loss of personal identity and memory, often accompanied by unexpected travel or wandering.

Psychogenic Amnesia

A memory disorder characterized by sudden retrograde episodic memory loss, said to occur for a period of time proceeding a traumatic event, though not due to direct physical damage.

Catatonic Schizophrenia

A type of schizophrenia characterized by abnormal movement patterns, including stupor, rigidity, or excessive, purposeless movements.

Fugue Disorder

A rare psychological disorder characterized by reversible amnesia for personal identity, including the memories, personality, and other identifying characteristics of individuality, often involving unplanned travel or wandering.