According to random-walk theory, what are the odds that a stock will increase in price after having increased on two consecutive days of trading?
A) 0%
B) 25%
C) 50%
D)100%

Question

Quizplus · Accepted Answer

The random-walk theory suggests that stock price movements are independent of each other. Therefore, the probability of a stock increasing or decreasing on any given day is always 50%, regardless of previous movements.

According to Random-Walk Theory, What Are the Odds That a Stock