An efficient market is one in which all relevant information about the stock is reflected in the stock price.

Question

Quizplus · Accepted Answer

An efficient market theory assumes that all investors have the same access to information and use it rationally to make investment decisions. In such a market, the stock prices fully reflect all available information, making it impossible to consistently outperform or beat the market. Therefore, the correct answer is A, that an efficient market is one in which all relevant information about the stock is reflected in the stock price.

An Efficient Market Is One in Which All Relevant Information