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According to the efficient market hypothesis, which of the following statements is true? 1. High-beta stocks are consistently overpriced. 2. Low-beta stocks are consistently overpriced.

According to the efficient market hypothesis, which of the following statements is true?

1. High-beta stocks are consistently overpriced.

2. Low-beta stocks are consistently overpriced.

3. Positive alphas on stocks will quickly disappear.

4. Negative alpha stocks consistently yield low returns for arbitrageurs.

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