When Economists Say That Markets Are Efficient,what Are They Assuming

question 179

Multiple Choice

When economists say that markets are efficient,what are they assuming about markets

• A)They are perfectly competitive.
• B)They are not for illegal products.
• C)They are regulated by the government.
• D)They are monopolistic.

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Definitions:

Free Cash Flow

A financial metric that represents the amount of cash a company generates after accounting for capital expenditures used to maintain or expand its asset base.

Corporate Governance

The system of rules, practices, and processes by which a company is directed and controlled, focusing on balancing the interests of stakeholders.

CEO's Ability

Refers to the skills, experience, and leadership qualities that a Chief Executive Officer possesses in managing and guiding a company.

Agency Costs

Expenses that arise from conflicts of interest between management of a company and its shareholders, including costs related to monitoring and aligning interests.