Which of the Following Statements About Efficient Capital Markets Is

question 42

Multiple Choice

Which of the following statements about efficient capital markets is FALSE?

• A)An efficient capital market is one in which market prices fully reflect all information available to the public.
• B)There are no underpriced securities in an efficient capital market.
• C)In an efficient capital market,an inactive portfolio approach to investments is an appropriate investment strategy for most investors.
• D)In an efficient capital market,if a company changes to an accounting method that increases net income,the company's market price will increase.

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U.S. Constitution

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Self-Incrimination

The act of implicating oneself in a crime, protected against in many legal systems by the right to remain silent.

Fifth Amendment

A provision in the U.S. Constitution that, among other protections, prevents individuals from being compelled to incriminate themselves.

U.S. Constitution

The supreme law of the United States that outlines the national framework of government and the rights of the individual citizens.