Which one of the following would not be consistent with the semi-strong form of the efficient market hypothesis?

A. A few active equity managers consistently outperform the market indices after fees

B. Stocks of companies that are takeover targets tend to rise in price prior to the announcement of the takeover

C. The majority of stocks tend to rise in price over time

D. The market routinely fails to punish stocks of companies that fail to meet consensus earnings' expectations

Which of the following challenges is typically the most prominent for empirical tests of market efficiency?

A. Data gathering

B. Data mining

C. Data manipulation

D. Data misspecification

Assume an equity market neutral portfolio (i.e., beta = 0) is constructed from a combination of one part investors' "equity" contributions and five parts leverage.This levered strategy produced a gross annual return of 13% before fees and interest income, the stock lenders chargesd a fee of 1% p.a. to loan stock, and cash sitting in the portfolio earned 2% p.a.. If the strategy's idiosyncartic variance before leverage was .000144, the Sharpe ratio of the strategy on an unlevered basis was closet to

A. 1.50

B. 1.39

C. 1.25

D. 1.20