Two Weeks Ago Ace Electronics Announced That It Had Developed

question 63

Multiple Choice

Two weeks ago Ace Electronics announced that it had developed a new chip design which was being considered by major companies for use in future smart phone development.At the close of trading the day before the announcement,Ace common stock closed at $20.On the day following the announcement,Ace closed at $21.Two days after the announcement the stock closed at $22.50.Four days after the announcement the stock traded at $23.Last week,Ace stock traded at $26,a level it has maintained since then.This is an example of a(n) :

• A)over-reaction and correction.
• B)underpricing.
• C)delayed reaction.
• D)pre-activity action.
• E)efficient market reaction.

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Definitions:

Capacitive Reactance

The opposition that capacitors present to the change of voltage in AC circuits, inversely related to the frequency of the current and the capacitance.

Parallel Connection

A way of connecting electrical components in a circuit side by side, so each component is directly connected to the voltage source, and the voltage is the same across all components.

Frequency Source

A device or component that generates a steady and specific frequency of electrical signal.

Capacitive Reactance

The opposition that a capacitor presents to the change in voltage, measured in ohms.