Which of the Following Individuals Is Using Information Outsidethe Efficient

question 156

Multiple Choice

Which of the following individuals is using information outsidethe efficient markets hypothesis?
Someone who:

• A)has information about the aging U.S.population and expects stock for companies that cater to senior citizens to increase in
• Value.
• B)reads in the newspaper about a merger between two profitable firms and expects the stock prices for these
• Companies to rise.
• C)while auditing a dishonest company realizes that its profit estimates are greatly inflated and immediately sells her stock in
• The company.
• D)hears a rumor that a top bank may be in trouble, and decides to sell his stock in that company.

---

Definitions:

Emotionally Charged

Refers to situations or topics that evoke strong feelings or emotions.

Periodic Revision

The regular review and alteration of content or policies to ensure accuracy, relevance, and efficacy.

Early Childhood

The period in human development extending from birth to the beginning of formal schooling, around age 5 or 6.

Highly Accurate

Describes a measurement or result that is extremely precise and close to the true value.