Weak-Form Efficiency Implies That Past Stock Returns

question 31

Multiple Choice

Weak-form efficiency implies that past stock returns:

• A)form patterns that tend to repeat.
• B)are major inputs to investors for forming trading strategies.
• C)do not matter.
• D)are difficult to explain.

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Definitions:

Cost of Goods Sold

The total cost directly attributed to the production of goods that were sold, including materials, labor, and overhead.

Overapplied Overhead

A situation where the overhead allocated to products or services is more than the actual overhead costs incurred.

Factory Equipment

The machinery and tools used in the manufacturing process of a product, typically considered a long-term asset.

Administrative Expense

Costs related to the general operation of a company, such as salaries of executive personnel, office supplies, and utilities, not directly related to production or sales.