Economics · Financial Markets
The efficient market hypothesis (EMH) is foundational to the Capital Asset Pricing Model (CAPM). To test the validity of the EMH, one can examine whether historical data contradicts CAPM. If historical data were to contradict CAPM, which of the following would this imply abou t the market efficiency?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
Share:
- 1It would imply that the market is always efficient.
- 2It would imply that the market is inefficient.✓
- 3It would imply that historical data is irrelevant to market efficiency.
- 4It would imply that CAPM is infallible.
Correct answer
It would imply that the market is inefficient.
Download Single Question PDF
Save this question and verified answer as a clean study sheet with live clickable link.
👥
Share with Friends & Study Groups
Challenge your peer aspirants on WhatsApp or Telegram to solve this question!
Online Test Series
Start Free Mock Test →Preparing for Economics?
Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.
Chapter Practice
Practice Financial Markets MCQs →Want more practice questions on Financial Markets?
Solve complete topic-wise tests with detailed solutions on GkGet.
Related Practice Questions
Recommended practice questions in Economics · Financial Markets