Which of the Following Assumptions Imply Capital Markets Will Be

question 14

Multiple Choice

Which of the following assumptions imply capital markets will be efficient?

• A) A large number of independent profit-maximizing participants analyze securities.
• B) New information regarding securities comes to the market in a random fashion.
• C) Investors adjust security prices rapidly to reflect the effect of new information.
• D) Both b and c only.
• E) All of the above are assumptions that imply a market will be efficient.

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