An efficient market does not require that:

Related MCQs

• Which of the following statements is/are true with respect Capital Market Line (CML)? I. It is the line passing from risk-free rate through market portfolio. II. The slope of CML is called market price of risk. III. CML fails to express equilibrium pricing relationship between expected return and standard deviation for all efficient portfolios lying along the line.
• Which of the following is/are true if a firm has a required rate of return equal to the ROE? I. The amount of earnings retained by the firm does not affect market price or the P/E. II. The firm can increase market price and P/E by increasing the growth rate. III. The P/E ratio is inversely proportional to the ROE of the firm.
• According to the Efficient Market Hypothesis (EMH) I. Stocks with smaller beta will be consistently overpriced. II. Stocks with higher beta will be consistently underpriced. III. Positive alphas on stocks will not remain for a longer period.
• Which of the following statements is false with respect to different features of an efficient market?
• An efficient market reflects:
• In which form of the efficient market hypothesis do security prices reflect only past stock price and volume information?
• The most extreme form(s) of the Efficient Market Hypothesis (EMH) is
• Which of the following statements pertaining to the Efficient Market Hypothesis (EMH) is/ are true?
• Which of the following statements is false with respect to different features of an efficient market?
• According to the capital market line, the expected return of any efficient portfolio is a function of: