1. Given the predictability evidence for the U.S. stock market, which of the following statements are correct?

   I. A random walk process is an accurate model for the variation in major U.S. stock market indices (e.g., S&P 500).

   II. Predictable annual stock market returns imply that each years return is a draw from a probability distribution with a different mean.

   III. Last ten years returns are informative about the next ten years returns.

   	A.	Only I
   	B.	Only II
   	C.	II and III
   	D.	I and II