If the Efficient Markets Hypothesis Is Correct,then

question 12

Multiple Choice

If the efficient markets hypothesis is correct,then

• A)the number of shares of stock offered for sale exceeds the number of shares of stock that people want to buy.
• B)the stock market is informationally efficient.
• C)stock prices never follow a random walk.
• D)All of the above are correct.

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Definitions:

Days' Sales in Inventory

A financial metric that estimates how long it takes for a company to turn its inventory into sales.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold in a company, including materials and labor costs.

Inventory

The entire stock of materials and products that a company possesses for the aim of production or selling.

Market-to-Book Ratio

A financial ratio that compares a company's market value to its book value, indicating how investors value the company compared to its actual worth.