According to the efficient market hypothesis,financial markets fluctuate daily because they:
A) are inefficient.
B) slowly react to new information.
C) are continually reacting to new information.
D) offer tremendous arbitrage opportunities.
E) only reflect historical information.

Question

Quizplus · Accepted Answer

The efficient market hypothesis suggests that financial markets are continually reacting to new information, meaning that price fluctuations are a result of the market factoring in the latest information available. This contradicts options A, B, D, and E.

According to the Efficient Market Hypothesis,financial Markets Fluctuate Daily Because