Which of the Following Is Consistent with the Semi-Strong Form

question 17

Multiple Choice

Which of the following is consistent with the semi-strong form efficient market hypothesis?

• A) so-called value stocks outperform growth stocks.
• B) stocks that have performed well over the past year continue to perform well for several more months.
• C) a company announces higher than expected sales and earnings. The stock price immediately increases by 10%.
• D) a company announces higher than expected sales and earnings. The stock price remains unchanged.

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Definitions:

Monopsonist

A market condition in which a single buyer substantially controls the market as the major purchaser of goods and services.

Profit-Maximizing Quantities

The level of output at which a firm maximizes its profit, determined by the point where marginal cost equals marginal revenue.

Occupational Licensing

The laws of state or local governments that require that a worker satisfy certain specified requirements and obtain a license from a licensing board before engaging in a particular occupation.

Exclusive Unionism

The policy, pursued by many craft unions, in which a union first gets employers to agree to hire only union workers and then excludes many workers from joining the union so as to restrict the supply of labor and drive up wages. Compare with inclusive unionism. The policies typically employed by a craft union.