Which Statement Is Correct

question 40

Multiple Choice

Which statement is correct?

• A) It is much easier to judge whether the absolute level of stock prices is correct rather than whether their relative levels are correct.
• B) It is much easier to judge whether relative stock prices are correct than to judge whether their absolute level is correct.
• C) Most tests of market efficiency are concerned with the absolute level of stock prices.
• D) If relative prices are correct, then absolute prices must be correct also.

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Definitions:

Interstate Commerce Commission

The first federal agency in the United States, established in 1887, to regulate railroads and later other modes of transportation, ensuring fair rates and eliminating discriminatory practices.

Fair Rates

Charges or prices that are considered reasonable, equitable, and just, especially in the context of public utilities or services.

Farmers And Merchants

Refers to the traditional backbone of local economies, especially before industrialization, representing those who produce food and goods and those who trade them.

Chinese Immigrants

Relates to people from China who migrated to various countries around the world, particularly notable in the 19th and early 20th centuries to the United States for railroad construction and mining.