Based on the semi-strong form of the efficient market theory, an investor reacting immediately to a news flash on the television generally
A) can make an abnormal profit.
B) is guaranteed to make a reasonable profit.
C) is too late to make an exceptional profit.
D) will suffer a loss.

Question

Quizplus · Accepted Answer

According to the semi-strong form of the efficient market theory, all publicly available information is already reflected in the stock prices. Therefore, reacting immediately to a news flash on the television is generally too late to make an exceptional profit as the information is already incorporated into the market price.

Based on the Semi-Strong Form of the Efficient Market Theory