Under the efficient markets hypothesis, for news about a company's prospects to have a large impact on the price of the company's stock the news must
A) have an impact on the company's profitability in the short term.
B) have an impact on the company's profitability in the long term.
C) significantly increase the likelihood that the company will go bankrupt.
D) significantly reduce the liquidity of the company's stock.
B
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Full employment corresponds to
A) equilibrium in the labor market, with actual GDP being equal to potential GDP. B) labor demand being greater than labor supply and actual GDP being equal to potential GDP. C) being at the point where the marginal product of labor equals zero. D) equilibrium in the labor market, and actual GDP exceeding potential GDP.
A common argument in favor of restricting trade
a. concerns the strategy of bargaining. b. is that efforts should be made to get new industries started. c. emphasizes the belief that all countries should play by the same rules. d. All of the above are correct.
Education is heavily subsidized through public schools and government scholarships. This subsidization of education reflects the fact that
a. a negative externality requires a subsidy to move the market equilibrium closer to the social optimum. b. the social cost of education exceeds the private cost of education. c. the social value of education exceeds the private value of education. d. the market-equilibrium quantity of education exceeds the optimal quantity of education.
A 1977 amendment to the Federal Reserve Act of 1913
a. requires the Federal Reserve to place more weight on promoting price stability than on promoting maximum employment. b. requires the Federal Reserve to place more weight on promoting maximum employment than on promoting price stability. c. requires the Federal Reserve to place equal weight on promoting price stability and maximum employment. d. says the Federal Reserve should promote price stability and maximum employment, but does not specify how the Federal Reserve should weight these goals.