Which one of the following sets of stock prices best illustrates the random walk price theory?
A) 12, 13, 13, 14, 15, 9, 8, 9, 9
B) 11, 7, 10, 10, 8, 13, 14, 6, 13
C) 9, 9, 10, 10, 8, 8, 7, 7, 6
D) 7, 7, 7, 7, 9, 9, 9, 9, 10
E) 10, 10, 11, 11, 11, 11, 12

Question

Quizplus · Accepted Answer

The random walk theory suggests that stock prices move in an unpredictable manner, making it impossible to predict future movements based on past information. Choice B best illustrates this with its unpredictable fluctuations in stock prices, unlike the other options which show patterns or trends.

Which One of the Following Sets of Stock Prices Best