CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

Which of the following is not a characteristic of an efficient market?
A. Prices adjust rapidly to new information, and all available information is reflected in market prices.
B. Market prices never over-adjust or under-adjust.
C. There are many competing investors.
Explanation: An efficient market does not require all assets be correctly priced at all times. It merely requires that equilibrium (the correct price) be re-established reasonably quickly after new information arrives.

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