The Semi-Strong Form of the Efficient Market Hypothesis Maintains All

question 23

Multiple Choice

The semi-strong form of the efficient market hypothesis maintains all of the following except

• A)There is no learning lag in the distribution of public information
• B)All public information is immediately impounded into the value of a security
• C)Technical analysis is helpful in determining whether a stock is overvalued or undervalued
• D)Fundamental analysts cannot outperform the market

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Definitions:

Validity

The extent to which a test or tool measures what it is intended to measure, indicating the accuracy of the results.

Reliability

The consistency and stability of a measure over time.

Reactivity

The tendency of individuals to alter their performance or behavior due to the awareness that they are being observed.

Variability

describes the extent to which data points in a dataset differ from each other and from the average value.