When the Stock Price Follows a Random Walk the Price

question 34

Multiple Choice

When the stock price follows a random walk the price today is said to be equal to the prior period price plus the expected return for the period with any remaining difference to the actual return due to:

• A) a predictable amount based on the past prices.
• B) a component based on new information unrelated to past prices.
• C) the security's risk.
• D) the risk free rate.

---

Definitions:

Small Intestine

A part of the digestive system where most of the digestion and absorption of nutrients takes place, extending from the stomach to the large intestine.

Secretin

A hormone produced by the small intestine that stimulates the pancreas to release bicarbonate-rich fluid, aiding digestion.

Pancreatic Duct

A conduit through which digestive enzymes from the pancreas are transported to the small intestine.

Pancreatic Acinar Cells

The cells in the pancreas that produce digestive enzymes, which are secreted into the small intestine.