Efficient Financial Markets Fluctuate Continuously Because

question 36

Multiple Choice

Efficient financial markets fluctuate continuously because:

• A) the markets are continually reacting to old information as that information is absorbed.
• B) the markets are continually reacting to new information.
• C) arbitrage trading is limited.
• D) current trading systems require human intervention.
• E) investments produce varying levels of net present values.

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Definitions:

≠ Symbol

A mathematical symbol denoting inequality, signifying that two values or expressions are not equal.

Directional

Hypotheses that predict the nature of the effect of one variable on another, specifying a direction of influence.

μ > 8

This inequality states that the population mean (μ) is greater than 8.

Alternative Hypothesis

A hypothesis that contradicts the null hypothesis, suggesting there is a significant difference or effect.