In an efficient market, the price of a security will:

Multiple Choice

• React to new information over a two-day period after which time no further price adjustments related to that information will occur.

• Be slow to react for the first few hours after new information is released allowing time for that information to be reviewed and analyzed.

• Rise sharply when new information is first released and then decline to a new stable level by the following day.

• React immediately to new information with no further price adjustments related to that information.

• Always rise immediately upon the release of new information with no further price adjustments related to that information.

The best definition of simulation analysis is: Multiple Choice A combination of scenario and sensitivity analyses. Investigation of what happens to NPV when only one variable is changed. O The determination of what happens to NPV estimates when we ask what-if questions. A combination of statistical and probabilistic analysis. O O The possibility that errors in projected cash flows lead to incorrect decisions