One Misconception About Market Efficiency Is That

question 8

Multiple Choice

One misconception about market efficiency is that:

• A) inefficiency implies price volatility
• B) prices are set in a varying manner
• C) expected returns imply actual returns
• D) new information is unpredictable

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Definitions:

Self-fulfilling prophecy

A belief or expectation that an individual or group holds about a future event that manifests because the individual believes it to be true.

Self-esteem

An individual's subjective evaluation of their own worth, encompassing beliefs about oneself as well as emotional states, such as triumph, despair, pride, and shame.

Support group

A group of people with common experiences or concerns who provide each other with encouragement, comfort, and advice.

Prevalence

The proportion of a particular population found to be affected by a specific condition at a given time.