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1. (a) Using your own words, discuss the semi-strong form Efficient Market Hypothesis. Identify the main tests used to examine SSFE, and briefly summarise
1. (a) Using your own words, discuss the semi-strong form Efficient Market Hypothesis. Identify the main tests used to examine SSFE, and briefly summarise the results of these tests. (b) Draw a properly labeled graph of the Markowitz efficient frontier. Use your own words to describe the efficient frontier in exact terms. Discuss the concept of dominant portfolios and show an example of one on your graph. (c) What is the real interest rate? What is the relationship between the real interest rate and nominal interest rate?
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a In an efficient market the return on a security is compensating the investor for time value of money and risk The efficient market theory relies on the fact that stock prices follow a random walk wh...
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MIS Essentials
Authors: David M. Kroenke
4th edition
978-0133546590, 133546594, 978-0133807479
