To Say That Stock Prices Follow a "Random Walk" Is

question 31

Multiple Choice

To say that stock prices follow a "random walk" is to argue that

• A) stock prices rise, then fall.
• B) stock prices rise, then fall in a predictable fashion.
• C) stock prices tend to follow trends.
• D) stock prices are, for all practical purposes, unpredictable.

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Definitions:

Nomograph

A type of graph used in seismology to determine the local magnitude of an earthquake.

S-Wave Amplitude

The measure of the height of the secondary or shear waves, which are one type of seismic wave produced by earthquakes.

Strike-Slip Faults

Faults where two blocks of crust slide past each other horizontally, with little vertical motion.

Plate Boundary

The margin or border between two tectonic plates, which can be characterized by seismic activity, volcanism, and distinct geological formations.