Which of the Following Is True About the Impact on Market

question 35

Multiple Choice

Which of the following is true about the impact on market price of a security when a company makes an announcement and the market has discounted the news?

• A) The price will change a great deal; even though the impact is primarily in the future, the future value is discounted to the present.
• B) The price will change little, since the impact is primarily in the future.
• C) The price will change little, since the market considers this information unimportant.
• D) The price will change little, since the market considers this information untrue.
• E) The price will change little, since the market has already included this information in the security's price.

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Definitions:

Need

A requirement essential to someone's well-being or the success of a task or objective.

Shelter

A structure that provides protection from weather and harm, serving as a place of safety and refuge.

Quick-Frozen

A method of freezing food at extremely low temperatures to preserve its quality, nutritional value, and taste.

Chicken

A type of poultry that is commonly raised for meat or eggs.