According to the Efficient Markets Hypothesis, Who Should Earn the Highest

question 20

Multiple Choice

According to the efficient markets hypothesis, who should earn the highest risk-adjusted return on stocks?

• A)a financial expert who can devote considerable time to research
• B)the average investor who doesn't do too much research
• C)someone throwing darts at possible stock picks
• D)all of the above should earn the same average return

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Definitions:

Degrees Of Acceptability

The range of conditions or outcomes that are considered acceptable or satisfactory by stakeholders, often used in the context of quality, risk, or ethical standards.

Formal Group

A group formed by an organization to achieve specific goals, characterized by structured and systematic workflows.

Rational

Based on logic or reason; characteristic of thought or action that is reasonable or sensible.

Group Attractiveness

The degree to which a group is appealing or desirable to its existing or potential members.