Suppose That Google Announces That Its Profits for the Third

question 42

Multiple Choice

Suppose that Google announces that its profits for the third quarter of 2011 were $1.6 billion.As a result of this announcement the price of Google's stock declines.The best explanation of this is

• A) market participants expected Google's profits to be greater than $1.6 billion for the third quarter.
• B) market participants expected Google's profits to be less than $1.6 billion for the third quarter.
• C) the stock market is not an efficient market.
• D) market participants have adaptive expectations.

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Definitions:

Blood Calcium Levels

The concentration of calcium in the blood, crucial for various physiological processes including bone formation and muscle contraction.

Amino Acid Derivatives

Simplest hormones, such as epinephrine and melatonin, that are derived from amino acids.

Fatty Acid Derivatives

Prostaglandins, juvenile hormones of insects, and other compounds derived from fatty acids.

Endocrine Gland

An endocrine gland is a gland that secretes hormones directly into the bloodstream to regulate various bodily functions.