Which One of the Following Statements Is Correct Regarding Moving

question 38

Multiple Choice

Which one of the following statements is correct regarding moving averages?

• A)The 50-day moving average reflects the long-term trend of the market.
• B)An exponential moving average is a weighted average.
• C)Moving averages are used primarily to measure trading volume.
• D)Short-term and long-term moving averages always move in the same direction.
• E)Moving averages are generally computed using average daily prices.

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Definitions:

Asset Purchase

An asset purchase involves buying the assets of a company, such as equipment, inventory, and property, rather than buying the company's stock.

Poison Pill

A strategy used by companies to prevent or discourage hostile takeovers by making the company less attractive to the potential acquirer.

Majority

More than half of a particular group or amount, often used to describe the age at which a person gains full legal rights and responsibilities.

Exchange Offer

A proposal by a company to trade securities, such as bonds or stocks, for other securities or assets with different terms or values.