Question

What does the Random Walk Theory propose about stock market prices?

a.

Predictable behavior of stock prices

b.

Unpredictable behavior of stock prices

c.

Direct relationship between present and future prices

d.

Consistent identification of over or under valued securities

Answer: (b).Unpredictable behavior of stock prices Explanation:The Random Walk Theory suggests that the behavior of stock market prices is unpredictable, and there is no relationship between present and future prices of shares.

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Q. What does the Random Walk Theory propose about stock market prices?

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