This week you are asked to answer the following short answers.

1) Identify the basic concepts of the Efficient Market Hypothesis (EMH) include a description of the three forms of the EMH.

2 Define the characteristics of stock prices as a martingale.

3) Describe how randomly generated output can appear nonrandom and how that might relate to asset prices and returns.

4) Identify the three areas in which behavioral finance challenges the EMH.

5) Explain momentum strategies and mean-reversion strategies.

6) Define the general concepts of value investing.

7) Describe why value investing is similar to mean-reversion.

8) Explain how value investing (Graham & Dodd) conflicts with the EMH.

9) Define fungibility in the context of financial markets.

10) Explain the term arbitrage and how it is used by traders.

11) Define the term noise and explain how it is different from information. Include what a noise trader is and how they become profitable.