An Investor Discovers That Predictions About Weather Patterns Published Years

question 8

Multiple Choice

An investor discovers that predictions about weather patterns published years in advance and found in the Farmer's Almanac are amazingly accurate.In fact,these predictions enable the investor to predict the health of the farm economy and therefore certain security prices.This finding is a violation of the:

• A)moderate form of the efficient market hypothesis.
• B)semistrong form of the efficient market hypothesis.
• C)strong form of the efficient market hypothesis.
• D)weak form of the efficient market hypothesis.
• E)efficient market hypothesis at all levels.

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Definitions:

Inelastic

Describes a situation where the quantity demanded or supplied of a good or service changes by a relatively small amount in response to changes in its price.

Quantity Demanded

The amount of a product or service consumers are willing and able to buy at a given price over a specified period of time.

Unit Elasticity

Demand or supply for which the elasticity coefficient is equal to 1; means that the percentage change in the quantity demanded or quantity supplied is equal to the percentage change in price.

Quantity Demanded

The total amount of goods or services that consumers are willing and able to purchase at a given price.