The Market Price of a Stock Tends to Fluctuate Throughout

question 36

Multiple Choice

The market price of a stock tends to fluctuate throughout every trading day.This fluctuation is:

• A)inconsistent with the semistrong form of the efficient market hypothesis because prices should be stable.
• B)inconsistent with the weak form of the efficient market hypothesis because all past information should already be included in the price.
• C)consistent with the semistrong form of the efficient market hypothesis because daily prices should adjust as new information becomes available.
• D)consistent with the strong form of market efficiency because prices are controlled by insiders.
• E)a strong indicator that abnormal profits can be realized.

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Definitions:

Infectious Diseases

Diseases caused by pathogenic microorganisms such as bacteria, viruses, parasites, or fungi that can be spread, directly or indirectly, from one person to another.

Circulatory Diseases

A category of diseases that affect the circulation of blood, including conditions like coronary artery disease, hypertension, and stroke.

Structural Model

An abstract representation showing the relationships between parts of a system, such as variables in a theory or components in a machine.

Negative Symptoms

In the context of psychiatry, symptoms that represent a reduction or loss of functions, such as blunted affect or social withdrawal.