Jason Has Just Attended a Seminar in Which He Learned

question 10

Essay

Jason has just attended a seminar in which he learned about the concept of efficient
markets. He tells you what he has learned and his conclusion: "The U.S. financial
markets are largely semistrong efficient, which means that I can't expect to earn any
excess returns on my investments, no matter how much risk I take, since I don't have
any insider information. Therefore, I should just keep my money in a savings account
or invest in a risk-free asset like a Treasury bond." Comment on Jason's conclusion.

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Definitions:

Tolerance

The process of becoming less responsive to a substance (such as a drug) or a stimulus after repeated exposure.

Withdrawal

The process of reducing or eliminating the use of a substance after prolonged dependency, often leading to uncomfortable physical and psychological symptoms.

Cardiac Problems

Health issues related to the heart, which can range in severity from minor to life-threatening conditions, including heart disease, arrhythmias, and heart attacks.

Emotional Distress

A state of emotional suffering often characterized by feelings of anxiety, depression, or stress.