According to the Efficient Markets Hypothesis,which of the Following Would

question 251

Multiple Choice

According to the efficient markets hypothesis,which of the following would increase the price of stock in the McCloud Corporation?

• A) McCloud announces,just as everyone had expected,that it has hired a new highly respected CEO.
• B) McCloud announces that its profits were low,but not as low as the market had expected.
• C) Analysis by a column in a business weekly indicates that McCloud is overvalued.
• D) All of the above would increase the price.

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Definitions:

Marginal Returns

denotes the additional output obtained by adding one more unit of a specific input, while keeping other inputs constant.

Diseconomies of Scale

The scenario where costs start increasing as a company or project becomes too large, leading to inefficiency.

Bureaucratic

Relating to a system of government in which most of the important decisions are made by state officials rather than by elected representatives.

Large Management

Refers to the administration and execution of strategic objectives within large organizations, involving complex structures and substantial resource allocation.