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Briefly explain how the two key building blocks of behavioural finance are incompatible with the notion of efficient capital markets. Clearly explain the following terms:
- Briefly explain how the two key building blocks of behavioural finance are incompatible with the notion of efficient capital markets.
- Clearly explain the following terms:
- Cognitive psychology
- Heuristics
- Cognitive Dissonance
- According to Hong and Stein (1999) large firms are less prone to mispricing when there is divergence of opinion. Briefly explain this statement.
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Entrepreneurial Finance
Authors: J. Chris Leach, Ronald W. Melicher
7th Edition
0357442040, 978-0357442043
