1.Assume that the market is efficient. Nicholas Manufacturing just announced yesterday that its fourth quarter earnings will be 10% higher than last year's fourth quarter. Stocks of Nicholas Manufacturing had an abnormal return of -1.2% yesterday. This suggests that __________.

	A.	investors expected the earnings increase to be what was actually announced
	B.	investors expected the earnings increase to be larger than what was actually announced
	C.	investors expected the earnings increase to be smaller than what was actually announced
	D.	investors expected the earnings to decrease in the fourth quarter

2.Assume that the market is efficient. The Food and Drug Administration (FDA) just announced yesterday that they would approve a new cancer-fighting drug from King Inc. You observe that stocks of King Inc. had an abnormal return of 0% yesterday. This suggests that ____________.

	A.	King stock will probably rise in value tomorrow
	B.	King stock will probably fall in value tomorrow
	C.	the approval was already anticipated by the market
	D.	the approval was not anticipated by the market