The form of market efficiency which states that prices of stock reflects the public and private information of the firm is classified as ___________?
Correct answer: B. strong form of market efficiency
- A. weak form of market efficiency
- B. strong form of market efficiency
- C. semi-strong form market efficiency
- D. expensive form market efficiency
Explanation
Strong-form efficiency holds that stock prices reflect both publicly available and private information. Semi-strong efficiency includes only public information, while weak-form efficiency uses past market data.
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Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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