On May 12, 2001 the WWF announced the demise of the XFL. The WWF stock price jumped up significantly on the day.
A) These results are consistent with strong from efficiency because insiders knew the league would fold.
B) These results are consistent with semi-strong form efficiency as the demise would reverse the negative cashflow.
C) These results are inconsistent with weak form efficiency because past price behavior predicted the collapse.
D) These results are inconsistent with all forms of market efficiency because a failure is a negative event.
E) These results are consistent with all forms of market efficiency as all information is known and priced in.
Correct Answer:
Verified
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