A Market Is Efficient If

question 28

Multiple Choice

A market is efficient if:

• A) investors are able to earn profits by trading on information.
• B) it takes time for market to adjust to new information.
• C) share prices fully reflect available information about the shares.
• D) available information can be used to earn returns beyond those that compensate for the risk involved.

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Definitions:

Test Statistic

A standardized value used in hypothesis testing to determine whether to reject the null hypothesis.

Viewing Time

The duration or amount of time spent looking at, engaging with, or observing something, such as a screen, artwork, or event.

National Average

The mean value calculated from data points collected across a nation, often used in reference to economic, educational, or health indicators.

Test Statistic

A calculated value from sample data used to make decisions about hypotheses, typically measuring how far the sample evidence deviates from what is expected under the null hypothesis.