Which of the Following Statements Correctly Describes a Strong Form

question 41

Multiple Choice

Which of the following statements correctly describes a strong form efficient market?

• A)Only those privy to insider information can expect to earn abnormally high returns.
• B)No one can earn a return over and above a fair return that would compensate him for his risk, except for the occasional lucky fool.
• C)The use of technical analysis can be used to find mispriced securities.
• D)Both A and C are correct statements.

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Definitions:

Demand Schedule

A table that shows the quantity of a good or service that consumers are willing and able to purchase at various prices.

Total Cost

The complete cost of production, including both fixed and variable costs.

Efficient Allocation

The optimal distribution of resources among different uses, ensuring that resources are utilized in a way that maximizes overall benefit or utility.

Excess Capacity

A situation where a firm is producing at a lower scale of output than it has been designed for, often leading to inefficiencies.