Which of the following is FALSE? Market efficiency implies:
A)new information disseminates quickly.
B)investors can take advantage of temporary time lags in information dissemination.
C)new information is instantly reflected in share prices.
D)the prices of securities are considered "right" at any time given their risk profile.

Question

Quizplus · Accepted Answer

Market efficiency implies that new information disseminates quickly and is instantly reflected in share prices. The prices of securities are considered "right" at any time given their risk profile. However, investors cannot take advantage of temporary time lags in information dissemination as market efficiency suggests that any time lag would be immediately reflected in the prices of securities.

Which of the Following Is FALSE? Market Efficiency Implies