1.5. You own shares in a pharmaceutical company, PillCo. R eading the Yahoo! Finance W eb site, you see that PillCo wa sued this morning by u ers ofPillCo's new heart drug, Amphlistatin.

PillCo's stock has already been trading for a few hours today.

a. When the bad news about the lawsuits came out, what probably happened to the price of Pill Co shares within just a few minutes?

b. According to the efficient markets hypothesis, hould you sell your shares in PillCo now, a few hours after the bad news came out?

c. In many statistical studies of the stock mar ket, the best strategy turns out to be "buy and hold." This means just what it sounds like: You buy a bunch of shares in differ ent companies and hold them through good times and bad. People often have a tough time with the "bad" part of "holding through good times and bad." What does your answer to part b tell you about this idea?