If the Financial Markets Are Efficient, Then Investors Should Expect

question 32

Multiple Choice

If the financial markets are efficient, then investors should expect their investments in those markets to:

• A) earn extraordinary returns on a routine basis.
• B) generally have positive net present values.
• C) generally have zero net present values.
• D) produce arbitrage opportunities on a routine basis.

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Definitions:

Pollution Free

An attribute of products, services, or practices that do not release harmful contaminants into the environment.

Clean Town

An initiative or effort to maintain a town or city in an environmentally friendly and litter-free condition.

Housing Prices

The amount of money required to purchase residential properties, influenced by factors such as location, demand, and economic conditions.

Indifference Principle

The indifference principle suggests that individuals have no preference between two or more equally satisfying options, reflecting a state of utility and choice.