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Which of the Following Statement Is FALSE Regarding Price Discovery

Question 17

Multiple Choice

Which of the following statement is FALSE regarding price discovery in a futures market?


A) As futures markets are believed to be semi-strong-form efficient,futures trading generates prices that reflect more information and provide better price forecasts.
B) Price discovery has long been justified by regulators as a prime reason for the existence of futures markets.
C) Futures markets can help discover prices in manipulated markets.
D) Futures markets cannot play their price discovery role in times of extreme market volatility.
E) Price discovery makes a futures market useful for planning output and input decisions in the production of goods.

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