If it proves possible to make abnormal profits based on information regarding past stock prices,then the market is:
A) weak-form efficient.
B) not weak-form efficient.
C) semi strong-form efficient.
D) strong-form efficient.

Question

Quizplus · Accepted Answer

If abnormal profits can be made based on past stock prices, it indicates that the market is not efficient in the weak-form. In a weak-form efficient market, all past stock prices and trading volume are reflected in current stock prices, making it difficult to obtain abnormal profits based on historical data.

If It Proves Possible to Make Abnormal Profits Based on Information