If It Proves Possible to Make Abnormal Profits Based on Information

question 127

Multiple Choice

If it proves possible to make abnormal profits based on information regarding past stock prices,then the market:

• A) is weak-form efficient.
• B) is not weak-form efficient.
• C) is semistrong-form efficient.
• D) is strong-form efficient.

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Definitions:

Direct Costs

Expenses that can be directly traced to a product or service, such as materials and labor.

Inventory Costing Methods

Refers to the techniques used to determine the value of an inventory, including LIFO (Last In, First Out), FIFO (First In, First Out), and weighted average methods.

Consigned Merchandise

Goods that are sent by one party to another to sell, with payment to the consignor occurring only after the sale.

Consignee's Inventory

Goods that are held by a consignee but still legally belong to the consignor until sold, after which sales revenue is shared as per agreement.