When Investors Are Not Capable of Making Superior Investment Decisions

question 106

Multiple Choice

When investors are not capable of making superior investment decisions on a continual basis based on past prices or public or private information, the market is said to be:

• A) weak-form efficient.
• B) semistrong-form efficient.
• C) strong-form efficient.
• D)fundamentally efficient.

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Definitions:

Defense Mechanism

Mental tactics employed by people to deal with real-life situations and preserve their sense of self.

Regression

A return to earlier stages of development in behavior, thought, or emotional functioning, often as a response to stress or trauma.

Juvenile Behavior

Actions or conduct typical of younger individuals or adolescents, often characterized by immaturity or inexperience.

Defense Mechanism

Psychological strategies brought into play by the unconscious mind to protect itself against anxiety by denying or distorting reality.