Cumulative abnormal returns (CAR)
A. are used in event studies.
B. are better measures of security returns due to firm-specific events than are abnormal returns (AR).
C. are cumulated over the period prior to the firm-specific event.
D. are used in event studies and are better measures of security returns due to firm-specific events than are abnormal returns (AR).
E. are used in event studies and are cumulated over the period prior to the firm-specific event.
D. are used in event studies and are better measures of security returns due to firm-specific events than are abnormal returns (AR).
As leakage of information occurs, the accumulated abnormal returns that are abnormal returns summed over the period of interest (around the event date) are better measures of the effect of firm-specific events.
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