If the Weak Form of the Efficient Market Hypothesis Holds

question 73

Multiple Choice

If the weak form of the efficient market hypothesis holds:

• A) share prices follow a random walk.
• B) share prices reflect all information contained in past prices.
• C) technical analysis is useless.
• D) all of the given answers are correct.

---

Definitions:

Patents

Legal documents granted by a government that give an inventor exclusive rights to use, make, and sell an invention for a certain period of time.

Perfect Mobility

The theoretical condition in which factors of production such as labor and capital can be moved without any barriers between industries or geographical locations.

Perfect Knowledge

A theoretical situation in which all participants in a market have complete and accurate information about past, present, and future conditions.

Short Run

A period in economics where at least one factor of production is fixed, leading to limited adjustments in production or operation.