According to the Semistrong Form of Market Efficiency, When New

question 53

Multiple Choice

According to the semistrong form of market efficiency, when new information becomes available in the market, the related stock prices will:

• A) remain unchanged because they already reflect this information.
• B) accurately and rapidly adjust to include this new information.
• C) adjust to accurately reflect this new information over the course of the next few days.
• D)most likely increase because all new information has a positive effect on stock prices.

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Definitions:

Specialization

The process of focusing on and becoming an expert in a particular field or task, potentially leading to increased efficiency and productivity.

Particular Product

A specific good or service that is distinct among others due to unique characteristics or qualities.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision or taking an action.

Moving From Point

The process of going from one position or condition to another, often used in discussions about changes in economic indicators or market positions.