If the Random Walk Theory Is Correct, a Prudent Investor

question 50

Multiple Choice

If the random walk theory is correct, a prudent investor might choose her stock portfolio by

• A)throwing darts at the newspaper's financial page.
• B)spending money to consult a stock forecaster.
• C)spending time analyzing past stock performance.
• D)not investing in stocks at all, since price behavior is completely erratic.

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Definitions:

Legalization

The process of making an act or substance legal that was previously illegal.

Drugs

Substances which are used for medication or in form of narcotics, which can potentially cause dependency and alter one’s physiological state.

Prescription Drug Abuse

The use of prescription medication in a manner not prescribed by a healthcare provider, often for non-medical reasons.

Young American Adults

Individuals in the United States typically aged between 18 and 25, representing the transition phase from adolescence to adulthood.