Arbitrage Traders

question 48

Multiple Choice

Arbitrage traders:

• A)tend to be well capitalized.
• B)tend to be irrational investors.
• C)are dominated by irrational investors in an efficient market.
• D)lower the efficiency level of a market.
• E)sell only relatively inexpensive stocks.

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Definitions:

Chi-Square Test

A statistical method employed to ascertain whether a meaningful discrepancy exists between the anticipated frequencies and the actual frequencies across one or several categories.

Independence

In the context of probability and statistics, refers to events that have no influence on each other's likelihood of occurring.

Random Sample

A sample drawn from a population in such a way that every individual has an equal chance of being selected.

Blood Type

The classification of human blood based on the presence or absence of antibodies and inherited antigenic substances on the surface of red blood cells.