2. (1 point) In fully efficient financial markets, stock prices .

(a) Follow a random walk.

(b) Are predictable.

(c) Are predictable during certain times.

(d) Are unrelated to economic fundamentals.

3. (1 point) In fully efficient financial markets, stock prices change when .

(a) There is a change in expected earnings or the discount rate.

(b) Investors become optimistic about the overall economy.

(c) Investors become pessimistic about the overall economy.

(d) Investors pay more attention on the market.