In an Efficient Market,__________

question 34

Multiple Choice

In an efficient market,__________.

• A) security prices react quickly to new information
• B) security prices are seldom far above or below their justified levels
• C) security analysts will not enable investors to realize superior returns consistently
• D) one cannot make money
• E) a,b,and c

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Definitions:

Recall Bias

A systematic error caused by differences in the accuracy or completeness of the recollections retrieved by study participants about past events or experiences.

Case-control Study

A research design in which participants with a certain outcome or disease are compared to those without, to identify and evaluate risk factors or outcomes.

Cholera Infections

A highly contagious bacterial disease causing severe diarrhea and dehydration, usually spread through contaminated water.

Selection Bias

A bias in how participants are chosen to participate in a study, leading to results that may not be generalizable to the larger population.