According to Shleifer (2000),the Theoretical Foundation of the Efficient Markets

question 27

Multiple Choice

According to Shleifer (2000) ,the theoretical foundation of the efficient markets hypothesis is:

• A)the trades of irrational investors will be random and cancel each other out,leaving prices unaffected.
• B)all securities will be priced rationally if markets are competitive.
• C)the trades of irrational investors will be random and cancel each other out leaving prices unaffected and all securities will be priced rationally if markets are competitive.
• D)none of the given options.

---

Definitions:

Chain Of Command

The formal line of authority, communication, and responsibility within an organization, usually depicted as a hierarchy from top to bottom.

Supervisors

Individuals within an organization responsible for overseeing the work of employees and ensuring tasks and goals are achieved.

Utilitarian Rule

A principle that dictates choosing actions that maximize happiness or benefit to the greatest number of people.

Greatest Good

A principle suggesting that actions should be evaluated based on their ability to produce the maximum amount of happiness or benefit for the greatest number of people.