When the Market Portfolio Is Not Efficient,theory Predicts That Stocks

question 4

Multiple Choice

When the market portfolio is not efficient,theory predicts that stocks with ________ market capitalizations or ________ book-to-market ratios will have ________ alphas.

• A) high; low; positive
• B) low; high; negative
• C) low; high; positive
• D) high; low; negative

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Definitions:

Social Trend

A general direction in which society’s behavioral patterns, attitudes, and preferences evolve over time.

Artificial Intelligence

The simulation of human intelligence in machines that are programmed to think like humans and mimic their actions.

Marketing Efforts

Actions or initiatives taken by a company to promote its products or services and reach its target market.

Companies

Legal entities formed by individuals, stockholders, or shareholders with the purpose of conducting commercial or industrial enterprise.