Chapter 11 The Efficient Market Hypothesis：11章有效市场假说.doc

Chapter 11 The Efficient Market Hypothesis ? Multiple Choice Questions? 1.?If you believe in the ________ form of the EMH, you believe that stock prices reflect all relevant information including historical stock prices and current public information about the firm, but not information that is available only to insiders.?A.?semistrongB.?strongC.?weakD.?semistrong, strong, and weakE.?hard ? 2.?When Maurice Kendall examined the patterns of stock returns in 1953 he concluded that the stock market was __________. Now, these random price movements are believed to be _________.?A.?inefficient; the effect of a well-functioning marketB.?efficient; the effect of an inefficient marketC.?inefficient; the effect of an inefficient marketD.?efficient; the effect of a well-functioning marketE.?irrational; even more irrational than before ? 3.?The stock market follows a __________.?A.?random walkB.?submartingaleC.?predictable pattern that can be exploitedD.?random walk and a predictable pattern that can be exploitedE.?submartingale and a predictable pattern that can be exploited ? 4.?A hybrid strategy is one where the investor?A.?uses both fundamental and technical analysis to select stocks.B.?selects the stocks of companies that specialize in alternative fuels.C.?selects some actively-managed mutual funds on their own and uses an investment advisor to select other actively-managed funds.D.?maintains a passive core and augments the position with an actively managed portfolio.E.?None of these are correct. ? 5.?The difference between a random walk and a submartingale is the expected price change in a random walk is ______ and the expected price change for a submartingale is ______.?A.?positive; zeroB.?positive; positiveC.?positive; negativeD.?zero; positiveE.?zero; zero ? 6.?Proponents of the EMH typically advocate?A.?an active trading strategy.B.?investing in an index fund.C.?a passive investment strategy.D.?an active trading strategy and investing i