2.7 Mechanistic hypothesis and efficient market hypothesis .. LO5 Hudson Ltd had always classified interest paid as an operating cash flow. In 2022 Hudson Lid changed its accounting policy and classified interest paid of $50 000 as a financing cash flow in its statement of cash flows. The reported amounts are summarised below. TUD S 2021 '000 400 (300) (50) - 50 2022 $'000 450 OB Net cash inflows from operating activities Net cash outflows for investing activities Net cash outflows from financing activities Net movement in cash (300) 100) Required 1. Describe the mechanistic hypothesis. What does the mechanistic hypothesis predict about how investors and therefore, share prices will respond to the increase in operating cash flows reported in Hudson Ltd's 2022 financial statements? 2. Describe the semi-strong form of market efficiency. What does the efficient market hypothesis predict about how investors and, therefore, share prices will respond to the increase in operating cash flows reported in Hudson Ltd's 2022 financial statements