If Stock Markets Are Inefficient

question 36

Multiple Choice

If stock markets are inefficient

• A)fundamental value analysis will not be effective.
• B)it will be easier for investors to find stocks that are undervalued.
• C)stock prices fully reflect information that is available to investors.
• D)stock selections by investors will not consistently beat the market.

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Definitions:

Responsibility Accounting

A system of accountability in which managers are held responsible for those items of revenue and cost—and only those items—over which they can exert significant control. The managers are held responsible for differences between budgeted and actual results.

Manager

A manager is an individual responsible for directing and administering an organization's or department's activities and strategies.

Operations

The day-to-day activities involved in the running of a business or production of goods and services.

Investment Center

A business segment or unit within an organization for which the manager has control and is responsible for its revenue, expenses, and the assets invested in the center.