Which of the following is the best statement of the efficient markets hypothesis?
A) Investors with information that a stock had a positive net present value (NPV) will buy it,while investors with information that a stock had a negative net present value (NPV) will sell it.
B) Investor's decisions are dependent on complete current information of a firm's cash flows and accurate predictions of future cash flows.
C) Competition between investors works to make the net present value (NPV) of all trading opportunities zero.
D) A share's price is the aggregate of the information of many investors.
E) Investors should only buy stocks with a positive net present value (NPV) .
Correct Answer:
Verified
Q45: Individual investors who grow up and live
Q107: On a certain date,Hasbro has a stock
Q108: Advanced Chemical Industries is awaiting the verdict
Q109: A study of trading behavior of individual
Q110: What are the major limitations of valuation
Q111: Use the table for the question(s)below.
Q113: If a manager wishes to raise his
Q115: Aerelon Airways,a commercial airline,suffers a major crash.As
Q116: Individual investors trade conservatively,given the difficulty of
Q117: Carbondale Oil announces that a wildcat well
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents