11-1Copyright©2017McGraw-HillEducation.Allrightsreserved.NoreproductionordistributionwithoutthepriorwrittenconsentofMcGraw-HillEducation.Chapter11TestBank-StaticStudent:___________________________________________________________________________1.Ifyoubelieveinthe________formoftheEMH,youbelievethatstockpricesreflectallrelevantinformation,includinghistoricalstockpricesandcurrentpublicinformationaboutthefirm,butnotinformationthatisavailableonlytoinsiders.A.semistrongB.strongC.weakD.Alloftheoptionsarecorrect.E.Noneoftheoptionsarecorrect.2.WhenMauriceKendallexaminedthepatternsofstockreturnsin1953,heconcludedthatthestockmarketwas__________.Now,theserandompricemovementsarebelievedtobe_________.A.inefficient;theeffectofawell-functioningmarketB.efficient;theeffectofaninefficientmarketC.inefficient;theeffectofaninefficientmarketD.efficient;theeffectofawell-functioningmarketE.irrational;evenmoreirrationalthanbefore3.ThestockmarketfollowsaA.nonrandomwalk.B.submartingale.C.predictablepatternthatcanbeexploited.D.nonrandomwalkandpredictablepatternthatcanbeexploited.E.submartingaleandpredictablepatternthatcanbeexploited.4.AhybridstrategyisonewheretheinvestorA.usesbothfundamentalandtechnicalanalysistoselectstocks.B.selectsthestocksofcompaniesthatspecializeinalternativefuels.C.selectssomeactively-managedmutualfundsontheirownandusesaninvestmentadvisortoselectotheractively-managedfunds.D.maintainsapassivecoreandaugmentsthepositionwithanactively-managedportfolio.5.Thedifferencebetweenarandomwalkandasubmartingaleistheexpectedpricechangeinarandomwalkis______,andtheexpectedpricechangeforasubmartingaleis______.A.positive;zeroB.positive;positiveC.positive;negativeD.zero;positiveE.zero;zero6.ProponentsoftheEMHtypicallyadvocateA.anactivetradingstrategy.B.investinginanindexfund.C.apassiveinvestmentstrategy.D.anactivetradingstrategyandinvestinginanindexfund.E.investinginanindexfundandapassiveinvestmentstrategy.11-2Copyright©2017McGraw-HillEducation.Allrightsreserved.Noreproductionordistribu...
