The process of taking advantage of market inefficiencies to earn profits is called:
A) arbitrage.
B) technical analysis.
C) a random walk.
D) futures contracting.

Question

Quizplus · Accepted Answer

The process of taking advantage of market inefficiencies to earn profits is called arbitrage. This involves buying and selling assets at different prices in different markets to make a profit from the price discrepancy. Technical analysis is the study of past market data to predict future price movements, while a random walk theory suggests that stock prices move randomly and cannot be predicted. Futures contracting involves buying or selling assets at a predetermined price to hedge against potential future losses.

The Process of Taking Advantage of Market Inefficiencies to Earn