Question

A proponent of the efficient markets hypothesis would be most likely to agree with which of...

A proponent of the efficient markets hypothesis would be most likely to agree with which of the following statements?

When a security has recently been experiencing high rates of return, it's likely to experience less-than-average rates of return in the future.
After adjusting for things like transactions and information costs, stocks sell for a good approximation of their fundamental value.
Over the long run, financial investment in small firms has been more profitable than in large firms.
All of the listed options are correct.
Certain stock trading strategies produce consistently higher returns.
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Answer #1

Ans is C) Over the long run, financial investment in small firms has been more profitable than in large firms.

Explanation:

Proponents of the Efficient Market Hypothesis conclude that, because of the randomness of the market, investors could do better by investing in a low-cost, passive portfolio.

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