4. Which of the following ways best describes how arbitrage contributes to market efficiency? A. Arbitrage penalizes

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4. Which of the following ways best describes how arbitrage contributes to market efficiency?

A. Arbitrage penalizes those who trade too rapidly.

B. Arbitrage equalizes the risks taken by all market participants.

C. Arbitrage improves the rate at which prices converge to their relative fair values.

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Derivatives

ISBN: 9781119850571

1st Edition

Authors: CFA Institute

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Question Posted: Oct 23, 2024 08:04 AM

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4. Which of the following ways best describes how arbitrage contributes to market efficiency? A. Arbitrage penalizes

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Derivatives

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