An implication of the efficient market hypothesis

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Reference no: EM131887896

1. Which of the following statements is (are) correct?

A. If a market is weak-form efficient, it is also semi-strong-form and strong-form efficient.

B. If a market is semi-strong-form efficient, it is also strong-form efficient.

C. If a market is not semi-strong-form efficient, it must also be not weak-form efficient.

D. If a market is not strong-form efficient, it must be neither semi-strong- nor weak-form efficient.

E. If a market is not weak-form efficient, it must be neither semi-strong- nor strong-form efficient

2. An implication of the efficient market hypothesis is that __________.

A. high-beta stocks are consistently overpriced

B. low-beta stocks are consistently overpriced

C. high-beta stocks are consistently underpriced

D. low-beta stocks are consistently underpriced

E. negative alphas will persist

F. negative alphas will quickly disappear

Reference no: EM131887896

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