Friday, October 10, 2014

Your best friend calls and gives you the latest stock market \"hot tip\" that he heard at...

1) If a corporation announces that it expects quarterly earnings to increase by 25% and it actually sees an increase of 22%, what should happen to the price of the corporation\"s stock if the efficient markets hypothesis holds, everything else held constant?

2) Your best friend calls and gives you the latest stock market \"hot tip\" that he heard at the health club. Should you act on this information? Why or why not?

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