If Security Prices Fully Reflect All Market-Related Information (Such as Historical

question 30

Multiple Choice

If security prices fully reflect all market-related information (such as historical price patterns) but do not fully reflect all other public information, security markets are

• A) weak-form efficient
• B) semistrong-form efficient.
• C) strong-form efficient.
• D) B and C
• E) none of the above

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Definitions:

Mean

The average of a set of numbers, calculated by dividing the sum of the values by the count of numbers.

Probability Density Functions

Functions that describe the relative likelihood for a continuous random variable to take on a given value.

Continuous Random Variables

Variables that can take an infinite number of values within a given range, often associated with measurements in time, distance, or temperature.

Area Under the Curve

A measure used in various statistical analyses to quantitatively summarize the shape of a curve, often related to the performance of a model or the distribution of data.