Which of the following are forms of market efficiency?
I. Strong form
Ii. Semistrong form
Iii. Semiweak form
Iv. Weak form
A)i and iii only
B)i and iv only
C)i, ii, and iv only
D)ii, iii, and iv only
E)i, ii, iii, and iv

Question

Quizplus · Accepted Answer

Market efficiency refers to the degree to which stock prices reflect all available and relevant information. The four forms of market efficiency are strong form, semistrong form, semiweak form, and weak form.

Strong form efficiency implies that all information, whether public or private, is reflected in stock prices.

Semistrong form efficiency implies that all publicly available information is reflected in stock prices, including news headlines, financial statements, and company announcements.

Semiweak form efficiency implies that stock prices reflect only historical price and volume data.

Weak form efficiency implies that stock prices do not reflect any information, whether from past prices and volumes or public and private sources.

Therefore, only i, ii, and iv are forms of market efficiency, making choice C the correct answer.

Which of the Following Are Forms of Market Efficiency