QUESTION 41

Suppose that separate firms were tested to determine how many of them "beat the market" using a Jensen-type regression, and it is found that 3 fund managers significantly do so at the 5% level. Does this suggest prima facie evidence for stock market inefficiency?

a. No

b. Yes, because 3 managers did beat the market

c. In order to answer this question, you would need to test every fund manager in the market

d. There is insufficient information to answer this question