Which one of the following statements related to market efficiency tends to be supported by current evidence?
A) It is easy for investors to earn abnormal returns.
B) Short-run price movements are easy to predict.
C) Markets are most likely only weak form efficient.
D) Mispriced stocks are easy to identify.
E) Markets tend to respond quickly to new information.

Question

Quizplus · Accepted Answer

Current evidence suggests that markets tend to respond quickly to new information, indicating a high level of efficiency. Options A, B, C, and D are all incorrect as they suggest market inefficiency, which is not supported by current evidence.

Which One of the Following Statements Related to Market Efficiency