If the Optimal Forecast of the Return on a Security

question 89

Multiple Choice

If the optimal forecast of the return on a security exceeds the equilibrium return,then

• A)the market is inefficient.
• B)no unexploited profit opportunities exist.
• C)the market is in equilibrium.
• D)the market is myopic.

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Definitions:

Time-Pressed

The state of being under pressure to complete tasks within a limited timeframe.

Negative Emotions

Feelings that are generally considered to be unpleasant or undesirable, such as sadness, anger, fear, or jealousy.

Heart Disease

A range of conditions that affect the heart, including blood vessel diseases, heart rhythm problems (arrhythmias), and heart defects among others.

Heart Disease

A group of disorders that affect the heart and blood vessels, often related to atherosclerosis or the buildup of plaque in the arterial walls.