If Financial Markets Are Efficient, That Suggests That

question 18

Multiple Choice

If financial markets are efficient, that suggests that

• A)investors cannot earn superior returns
• B)investors cannot expect to outperform the market consistently
• C)security prices are random
• D)bearing additional risk will not increase return

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Definitions:

Affluent

Pertaining to individuals or areas with an abundance of wealth and resources.

Familial Characteristics

Traits, features, or tendencies that can be observed within a family or passed down through generations.

Feebleminded

An outdated and offensive term historically used to describe individuals with intellectual disabilities or perceived as having lower intellectual capabilities.

Neurotic

A term related to neurosis, referring to a psychological state characterized by excessive anxiety or insecurity, without a break from reality.