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Please, be sure to respond using appropriate research sources. The word count limit for each question is 100 to 150 words. Thank you, 1. A stock

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Please, be sure to respond using appropriate research sources. The word count limit for each question is 100 to 150 words. Thank you, 1. A stock market analyst is able to identify mispriced equities by comparing the average price for the last 10 days with the average price for the last 60 days. If this is true, what do you know about the market? 2. Imagine that a particular macroeconomic variable that influences your firm’s net earnings is positively serially correlated. Assume market efficiency. Would you expect price changes in your shares to be serially correlated? Why or why not? 3. Some people argue that the efficient market hypothesis cannot explain the 1987 market crash or the high price-to-earnings ratio of European shares in 2005 and 2006. What alternative hypothesis is currently used for these two phenomena? 4. Several celebrated investors have recorded huge returns on their investments over the past three decades. Does the success of these particular investors invalidate the EMH? Explain. 5. When the 56-year-old founder of the Turkish firm Gulf Oil and Minerals died of a heart attack, the share price immediately jumped from 18.00 lira a share to 20.25 lira, a 12.5 per cent increase. This is evidence of market inefficiency, because an efficient stock market would have anticipated his death and adjusted the price beforehand. Assume that no other information is received, and the stock market as a whole does not move. Is this statement about market efficiency true or false? Explain. 6. Discuss some of the anomalies to market efficiency that have been detected in academic research. Taken together, do these anomalies provide concrete evidence that the market is inefficient? Why or why not? Explain. 7. What are the three conditions under which markets may be efficient? Describe these in detail, and provide a practical example illustrating each condition in practice. 8. Compare and contrast both Efficient Market and Behavioural Finance theories. In your opinion, which is the most reflective of market behaviour? Explain.
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