Q1: Respond to each of the following comments:    If stock prices follow a random walk, then capital markets are little different from a casino.  A good part of a company’s future prospects is predictable. Given the ace, stock prices cannot possibly follow a random walk.  If markets are efficient, you might as well select your portfolio by throwing darts at the stock listings in the The Wall Street Journal.

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Q: If you expect a stock market downturn, one potential defensive strategy would be to __________.…

A: See below

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Q: 3.21%

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A: As per company policy, it is only possible to solve one question.

Q: PLEASE HELP ME. THANK YOU!

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A:

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Market Efficiency

Market efficiency refers to the market's ability to provide investors with all available information about investment options for buying and selling securities. Market efficiency reflects the true value of securities without undervaluing or overvaluing them. When the quality and quantity of information increase, the market becomes more efficient, allowing it to reduce arbitrage and obtain higher market returns from investment. In a well-functioning market, everyone receives all information completely and immediately at no cost. It opens up a plethora of opportunities for investors to access various investment options.