Quiz Ch 13 – Consequences of the Random Walk Theory on Stock Prices
Principles of Corporate Finance
13th Edition
What does the assertion that stock prices follow a random walk suggest?
What does the assertion that stock prices follow a random walk suggest?
How do financing decisions stand apart from investment decisions?
What sets financing decisions apart from investment decisions?
Which investor is likely to achieve superior returns over time if markets are efficient?
Which observations would contradict the strong form of efficient market theory?
What should investors anticipate if the efficient market hypothesis is valid?
What leads to the self-destruction of stock price cycles or patterns once investors recognize them?
Where does a firm find positive NPV opportunities?
How does informational efficiency in financial markets impact stock prices?
What is the recommended approach for mutual fund managers under the assumption of strong-form efficiency?