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ch13 - ch13 Student Multiple Choice Questions 1 An...

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ch13 Student: _______________________________________________________________________________________ Multiple Choice Questions 1. An efficient capital market is one in which: A. brokerage commissions are zero. B. taxes are irrelevant. C. securities always offer a positive rate of return to investors. D. security prices are guaranteed by the U.S. Securities and Exchange Commission to be fair. E. security prices reflect available information. 2. The notion that actual capital markets, such as the NYSE, are fairly priced is called the: 3. The hypothesis that market prices reflect all available information of every kind is called _____ form efficiency. 4. The hypothesis that market prices reflect all publicly available information is called _____ form efficiency. 5. The hypothesis that market prices reflect all historical information is called _____ form efficiency. A. open B. strong C. semistrong D. weak E. stable
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6. In an efficient market, the price of a security will: 7. If the financial markets are efficient, then investors should expect their investments in those markets to: 8. Which one of the following statements is correct concerning market efficiency?
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