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5. State whether the following are true or false. Explain your statement. (a) Mental accounting is one type of errors in information processing. (5 marks)

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5. State whether the following are true or false. Explain your statement. (a) Mental accounting is one type of errors in information processing. (5 marks) (b) Behavior biases would still matter if rational arbitragers could fully exploit the mistakes of behavioral investors. ( 5 marks) (c) A finding that small firms earn higher returns than large firms would provides evidence against the weak form of the efficient market theory. ( 5 marks)

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