A person who believes strongly in the use of fundamental analysis to choose a portfolio of stocks
A)has a better chance of outperforming the market if stock prices follow a random walk than if they do not follow a random walk.
B)almost always chooses to hold index funds in his or her portfolio rather than actively-managed funds.
C)is spending his or her time wisely if the efficient markets hypothesis is correct.
D)is interested in the likely ability of a corporation to pay dividends in the future.

Question

Quizplus · Accepted Answer

A person who believes strongly in fundamental analysis is interested in evaluating a corporation's financial health and future prospects, such as its ability to pay dividends. This is consistent with the focus of fundamental analysis. Options A, B, and C are not necessarily relevant to the beliefs and practices of a fundamental analyst.

A Person Who Believes Strongly in the Use of Fundamental