All of the Following Are Possible Consequences of Noise Traders

question 48

Multiple Choice

All of the following are possible consequences of noise traders EXCEPT

• A) increased volatility in the financial market.
• B) asset prices differing from fundamental values.
• C) herd behavior contributing to speculative bubbles.
• D) reduced volatility of asset prices.

---

Definitions:

Concentration Gradient

Difference in the relative abundance of a substance among regions of a container; allows the substance to diffuse from an area of higher concentration to an area of lower concentration.

Diffusion

The movement of molecules from an area of higher concentration to an area of lower concentration, a fundamental process in biology and chemistry.

Negatively Charged

Having more electrons than protons, resulting in a net charge that is less than zero.

Protein Anions

Negatively charged proteins that play various roles in cellular functions, including maintaining cell structure and function.