Inside Information Has the Least Value When Financial Markets Are

question 67

Multiple Choice

Inside information has the least value when financial markets are:

• A) weak form efficient.
• B) semiweak form efficient.
• C) semistrong form efficient.
• D) strong form efficient.
• E) inefficient.

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Definitions:

Annual Coupon Bonds

Bonds that pay interest to the bondholder yearly until maturity, at which point the face value is also repaid.

Yield To Maturity

The expected total yield from a bond when held until its maturity date.

Duration

A measure of the sensitivity of the price of a bond or other debt instrument to interest rate changes, representing the weighted average time until all cash flows are received.

Yield-To-Maturity

The expected total yield on a bond when held to its maturity date, stated as a yearly percentage.