According to the Random Walk Theory, Which of the Following

question 223

Multiple Choice

According to the random walk theory, which of the following is true?

• A) Stock prices reflect all available information about factors that affect stock prices.
• B) Future movements of stock prices are unpredictable.
• C) Changes in stock prices are driven by surprise occurrences.
• D) All of the above are true.

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Definitions:

Perfect Competitor

An idealized market scenario where numerous buyers and sellers interact, leading to the best products at the lowest prices due to competition.

Monopolist

An individual or company that is the sole supplier of a particular good or service, allowing them to control the market price.

Maximizing Profits

The process of adjusting production levels and pricing strategies to achieve the highest possible return on investment.

Minimizing Losses

Strategies or actions taken by businesses or investors to reduce financial losses or minimize risks.