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According to the efficient markets hypothesis
A) common stock prices should be constant.
B) the price of a corporation's stock is likely to fluctuate substantially in response to news about changes in the company's short-term prospects.
C) the price of a corporation's stock will fluctuate significantly only in response to news about changes in the company's long-term prospects.
D) price fluctuations in common stock are a response to fads and are only infrequently the result of changes in the expected profitability of the companies involved.
Textbook 
Money, Banking, and the Financial System

Money, Banking, and the Financial System


Edition: 3rd
Authors:
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