Which one of the following statements is NOT true?
A) The overall efficiency of a capital market depends on its operational efficiency and its informational efficiency.
B) Operational efficiency focuses on bringing buyers and sellers together at the lowest possible cost.
C) If market prices reflect all relevant information about securities at a particular point in time, the market is operationally efficient.
D) All of the above are true.

Question

Quizplus · Accepted Answer

The statement that if market prices reflect all relevant information about securities at a particular point in time, the market is operationally efficient is false. This statement actually describes informational efficiency, not operational efficiency. Operational efficiency refers to the ease and efficiency with which trades can be executed, while informational efficiency refers to the extent to which market prices reflect all available information.

Which One of the Following Statements Is NOT True