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Which of the Following Stock Price Observations Would Appear to Contradict

Question 33

Multiple Choice

Which of the following stock price observations would appear to contradict the weak form of the efficient market hypothesis?


A) The average rate of return is significantly greater than zero.
B) The correlation between the market return one week and the return the following week is zero.
C) You could have consistently made superior returns by buying stock after a 10% rise in price and selling after a 10% fall.
D) You could have consistently made superior returns by forecasting future earnings performance with your new Crystal Ball forecast methodology.

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