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1. (a) If a corporation announces that it expects quarterly earnings to increase by 25 percent and it actually sees an increase of 25 percent,

1. (a) If a corporation announces that it expects quarterly earnings to increase by 25 percent and it actually sees an increase of 25 percent, what should happen to the price of the corporation's stock if the efficient markets hypothesis holds, everything else held constant?
(b) What should affect the fundamental value of a stock according to the efficient markets hypothesis?

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