- CFA Exams
- CFA Level I Exam
- Topic 5. Equity Investments
- Learning Module 38. Market Efficiency
- Subject 2. Forms of Market Efficiency
CFA Practice Question
Which of the following statements is (are) true if the efficient market hypothesis holds?
B. It implies the market is irrational and prices follow a particular pattern.
C. It implies that prices reflect all available information.
A. It implies perfect forecasting ability.
B. It implies the market is irrational and prices follow a particular pattern.
C. It implies that prices reflect all available information.
Correct Answer: C
User Contributed Comments 2
| User | Comment |
|---|---|
| chenyx | EMH does not assume that market participants correctly adjust prices,just that their price adjustments are unbiased |
| chezyfive | I guess this is straight forward enoungh! |