The efficient-markets hypothesis states:
A) The price of every stock equals the value of the stock, so no stock is a better buy than any other.
B) The price of every stock is greater than the value of the stock, so look for stocks with high prices.
C) Markets display cognitive dissonance, so look for stocks with high price-to-equity ratios.
D) Market participants can earn extra long-run returns, which drive up the price of a stock.
Correct Answer:
Verified
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