Equity Investments Q115

0. Tim observed that company XYZ’s share price reacts gradually to the public release of its annual report. With respect to efficient markets, which of the following most likely indicates the market where company XYZ trades?

  • Option : C
  • Explanation : Based on the convention used in the curriculum, the term „with respect to efficient markets‟ implies that the markets are efficient. If the market is efficient, the most likely reason for the stock price to „react gradually‟ is that the market is waiting for additional information.
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