1. Suppose today there is publicly available new information disclosed in the market that the stock price of Tesla would likely experience around 30% return by the end of 2021 due to their excellence in operational performance. However, the market equilibrium return of Tesla is 15%. According to the efficient market hypothesis, how does this new information would affect the stock return of Tesla by the next trading day? Do you have to wait until 2021 to observe 30% return? Why or why not?
2. Do you believe in the efficient market hypothesis? Provide at least three strong arguments (with references if possible) to support your opinion.