If Stock Prices Follow a Random Walk,then Stock Investors Can

question 19

Multiple Choice

If stock prices follow a random walk,then stock investors can make large profits by

• A)buying stocks whose prices have been falling for several days.
• B)buying stocks whose prices have been rising for several days.
• C)performing fundamental analysis of stocks using data contained in annual reports.
• D)using inside information.

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Definitions:

DP

An abbreviation that can refer to different concepts depending on the context, such as "Dual Purpose", "Dew Point", or "Distribution Point" in various fields.

Shaft Speed

The rotational speed of a shaft, measured in revolutions per minute (RPM), indicating how fast the shaft is spinning.

Spur Gears

Gears with teeth that are straight and mounted on parallel shafts, commonly used in machinery for transferring motion and power.

Perpendicular

Describes two lines or planes that intersect at a right angle (90 degrees) to each other.