If the efficient markets hypothesis is correct, then
A)the number of shares of stock offered for sale exceeds the number of shares of stock that people want to buy.
B)the stock market is informationally efficient.
C)stock prices never follow a random walk.
D)at the market price, more people think the stock is overvalued rather than undervalued.

Question

Quizplus · Accepted Answer

The efficient markets hypothesis posits that stock prices fully reflect all available information, making the market informationally efficient. This means that it is impossible to consistently achieve higher returns than the overall market through stock selection or market timing based on publicly available information.

If the Efficient Markets Hypothesis Is Correct, Then