Question :
51.Theefficientmarketshypothesisimpliesthat
a.buildinga portfolio based a published list ofthe“mostrespected”companiesislikelytoproduceabetterthan-averagereturn.
b.ifastockros : 1261876
51.Theefficientmarketshypothesisimpliesthat
a.buildinga portfolio based on a published list ofthe“mostrespected”companiesislikelytoproduceabetterthan-averagereturn.
b.ifastockroseinpricelastyear,itislikelytoriseinpricethisyear.
c.managedmutualfundsshouldgenerallyoutperformindexedmutualfunds.
d.Noneoftheabovearecorrect.
52.Theefficientmarketshypothesissaysthatbeatingthemarketconsistentlyis
a.impossible.Manystudiesfindthatbeatingthemarketis,atbest,extremelydifficult.
b.impossible.Manystudiesfindthatbeatingthemarketisrelativelyeasy.
c.relativelyeasy.Manystudiesfindthatbeatingthemarketis,atbest,extremelydifficult.
d.relativelyeasy.Manystudiesfindthatbeatingthemarketisrelativelyeasy.
53.Ifyouareconvincedthatstockpricesareimpossibletopredictfromavailableinformation,thenyouprobablyalsobelievethat
a.theefficientmarketshypothesisisnotacorrecthypothesis.
b.thestockmarketisinformationallyefficient.
c.thestockmarketisinformationallyinefficient.
d.thereisnoreasontoestablishadiversifiedportfolioofstocks.
54.Apersonwhobelievesstronglyintheuseoffundamentalanalysistochooseaportfolioofstocks
a.hasabetterchanceofoutperformingthemarketifstockpricesfollowarandomwalkthaniftheydonotfollowarandomwalk.
b.almostalwayschoosestoholdindexfundsinhisorherportfolioratherthanactively-managedfunds.
c.isspendinghisorhertimewiselyiftheefficientmarketshypothesisiscorrect.
d.isinterestedinthelikelyabilityofacorporationtopaydividendsinthefuture.
55.Whichofthefollowingmethodsofpickingstocksisnotconsistentwithfundamentalanalysis?
a.doingresearchsuchasthoroughlyreadingandanalyzingcompanies’annualreports
b.choosingmutualfundsthataremanagedbyindividualswithgoodreputations
c.viewingindividualstockpricesasunpredictable
d.relyingupontheadviceofWallStreetanalysts
56.Theavailableevidenceindicatesthat
a.aboutone-halfofallmanagersofactivemutualfundsconsistentlyoutperformindexfunds.
b.outperformingthemarketonaconsistentbasisisextremelydifficulttodo.
c.thereislittletruthtothenotionthatthereisatrade-offbetweenriskandreturn.
d.thereislittletruthtotheefficientmarketshypothesis.
57.Theword“efficient”intheterm“efficientmarketshypothesis”referstotheideathat
a.fundamentalanalysisisanefficientwaytogoaboutchoosingwhichstockstobuyorsell.
b.stockpricesmoveupwardanddownward“efficiently,”ratherthanfollowinga“randomwalk.”
c.thestockmarketis“informationallyefficient.”
d.companiesemployofficersandmanagerswhoarewell-qualifiedtoperformtheirjobs.
58.Apharmaceuticalcompanyunexpectedlyannouncesthatitjustdevelopedanimportantnewdrug.Thisnewsshould
a.raisethepriceofthecorporation’sstock;ifitdoesnotthestockisovervalued.
b.raisethepriceofthecorporation’sstock;ifitdoesnotthestockisundervalued.
c.reducethepriceofthecorporation’sstock;ifitdoesnotthestockisovervalued.
d.reducethepriceofthecorporation’sstock;ifitdoesnotthestockisundervalued.
59.Ifyourresearchleadsyoutobelievethatthepresentvalueofastock’sdividendstreamandfuturepriceislessthan
a.overvaluedsoyoushouldconsiderbuyingit.
b.overvaluedsoyoushouldnotconsiderbuyingit.
c.undervaluedsoyoushouldconsiderbuyingit.
d.undervaluedsoyoushouldnotconsiderbuyingit.
60.Ifunexpectednewsraisedpeople’sexpectationsofacorporation’sfuturedividendsandprice,thenbeforethepricechangesthiscorporation’sstockwouldbe
a.overvalued,soitspricewouldrise.
b.overvalued,soitspricewouldfall.
c.undervalued,soitspricewouldrise.
d.undervalued,soitspricewouldfall.