Based on the Random Walk Theory,if a Stock's Price Decreased

question 101

Multiple Choice

Based on the random walk theory,if a stock's price decreased last week,then this week the price:

• A) will reverse last week's loss and go up.
• B) will continue last week's decline.
• C) will stand still until new information is released.
• D) has an equal chance of going either up or down.

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Definitions:

Likelihood

describes the probability of a particular event occurring within a set of circumstances.

Conformity

Conformity is the act of aligning one's beliefs, attitudes, and behaviors with those of a group or societal norms, often due to real or perceived group pressure.

Cognitive Dissonance

The psychological discomfort experienced from holding two or more conflicting beliefs, values, or attitudes.

Contradictory Cognitions

Holding two or more psychological beliefs, ideas, or values that are in conflict with one another.