Efficient financial markets are called so because they produce an amount of financial products that maximizes total surplus in the financial industry.

Question

Quizplus · Accepted Answer

Efficient financial markets are those that allocate resources and allocate risk in a way that maximizes societal welfare or total economic surplus, not just the surplus in the financial industry. The focus is on maximizing overall efficiency, not just the production of financial products.

Efficient Financial Markets Are Called So Because They Produce an Amount