"Fraud on the Market" Theory Holds That

Multiple Choice

"Fraud on the Market" theory holds that:

A) The auditor need not be liable for damages if the market ignored the audit report.
B) The auditor is liable for damages to those who relied on financial statements it audited that contained a material misstatement.
C) The plaintiffs do not have to show they relied on the financial statements, but merely that the market used the information contained in the financial statements to affect the stock price.
D) Both a and b.