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Which form of the efficient market hypothesis (EMH) is violated from the following observations? Explain. a. High price-to-earnings ratio (P/E) stocks tend to have positive

Which form of the efficient market hypothesis (EMH) is violated from the following observations? Explain.

a. High price-to-earnings ratio (P/E) stocks tend to have positive abnormal returns. (2 marks)

b. By observing the historical prices and historical trading volume, small hightech firms stocks tend to have higher rates of return than other blue-chip stocks. (3 marks)

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