What Is Meant by the Expression Stock Prices Follow a "Random

question 7

Multiple Choice

What is meant by the expression stock prices follow a "random walk?"

• A) The best prediction of next period's price change is last period's price change.
• B) Stock price changes do not depend statistically on prior price changes.
• C) Stock price changes tend to be positive.
• D) Stock price changes do not reflect market information.

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Definitions:

Union

An organization formed by workers in various trades or professions to protect and advance their rights and interests.

Picket Line

A boundary established by workers on strike, especially at the entrance to the place of work, meant to demonstrate grievance against the employer or to deter others from entering the site.

Negotiations

The process by which parties discuss and arrive at a mutual agreement on matters of common interest.

Union Leader

An individual who represents and defends the interests of a group of workers, helping to negotiate terms of employment such as wages and working conditions with employers.