Discussion Questions Chapter 10

Discussion Questions Chapter 10 - 5 Because everyone is...

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Discussion Questions – Chapter 10 1. The efficient market hypothesis assumes that information travels in a random, independent fashion and that prices are an unbiased reflection of all currently available information. 2. The weak form of the efficient market hypothesis suggests there is no relationship between past and future prices of securities. It has been tested by 1) tests of independence and 2) trading rule tests 3. I have no idea. 4. No.
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Unformatted text preview: 5. Because everyone is doing fundamental analysis, there is little in the way of unabsorbed or indigested information. 6. Basu, Banz’s, and Reinganum’s. 7. The strong form of the efficient market hypothesis is hypothesized that insider information is also immediately impounded into the value of a security. No. 8. Not sure. 9. Abnormal returns refer to gains beyond what the market would normally provide after adjustment for risk....
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This note was uploaded on 05/09/2011 for the course BUS 125 taught by Professor Ryan during the Fall '09 term at Northeast State.

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