The Strong Form of the Efficient Market Hypothesis Contends That

question 82

Multiple Choice

The strong form of the efficient market hypothesis contends that

• A)a select few institutional investors can earn abnormal profits.
• B)abnormal profits are randomly distributed.
• C)no one can consistently earn a profit.
• D)no one can consistently earn abnormal profits.

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Definitions:

Conformity Bias

Tendency for social psychology to treat group influence as a one-way process in which individuals or minorities always conform to majorities.

Cultural Adaptation

Involves the process of adjusting and integrating into a culture different from one's own, which may include adopting new behaviors, practices, and attitudes.

Social Influence

The effect that the words, actions, or mere presence of other people have on our thoughts, feelings, attitudes, or behavior.

Dual-process Dependency Model

A theoretical framework suggesting that two distinct cognitive processes (e.g., automatic and deliberative) interact in influencing behaviors and decisions.