In an Efficient Market

question 11

Multiple Choice

In an efficient market:

• A) all financial transactions have an NPV less than zero.
• B) the investor receives abnormal returns consistently.
• C) the investor is compensated properly for risk borne.
• D) prices adjust slowly to new information.

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Definitions:

Dualism

A philosophical concept that sees mind and body as two distinct entities that interact and influence each other.

Brain

The central organ of the human nervous system, responsible for thought, memory, emotion, touch, motor skills, vision, breathing, temperature, hunger, and every process that regulates our body.

Reflex Arc

A neural pathway that mediates an automatic response to a stimulus, involving sensory input and motor output without conscious thought.

Dualistic Nature

The concept of two fundamental parts or principles, such as mind and body, in contrast or opposition.