Question

In: Finance

Which of the following statement is correct?

Which of the following statement is correct?



DJIA is not value weighted



None of the above



If the Efficient Markets Hypothesis is NOT true, all stocks are correctly priced



Common shares is not a financial asset



Common shares is not a financial asset


Which of the following statement is NOT correct?



None of the above



Price Impact is not a trading cost for investors when trading common stocks



There is a decrease in number of IPOs after 2000



12b-1 Fee is not a trading cost for investors when trading common stocks



Mutual funds investors pay taxes on capital gain and dividends


Solutions

Expert Solution

Q1:

option A: DJIA is not a value weighted index unlike S&P 500. Whereas it is a price weighted index in which the value is derived from price per share of stocks

Q2:

option B: Price Impact is not a trading cost for investors when trading common stocks

----When trading common stocks, the price impact is considered as a trading cost. All the other options are correct.

jeff jeffy answered 2 years ago
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