Stock prices fluctuate daily.In relation to the efficient market hypothesis,these fluctuations are
A)inconsistent with the semistrong form of efficiency because prices should be stable.
B)inconsistent with all forms of market efficiency.
C)consistent with the semistrong form because new information arrives daily.
D)consistent with the strong form because prices and information are controlled by insiders.
E)consistent with all forms of market efficiency provided the prices do fluctuate on a daily basis.

Question

Quizplus · Accepted Answer

The semistrong form of the efficient market hypothesis states that all publicly available information is reflected in stock prices, including new information that arrives daily. Therefore, daily fluctuations are consistent with this form of efficiency.

Stock Prices Fluctuate Daily