Long TextExercise 81 of 81

The hypothesis that financial markets are efficient - that asset prices at any given moment reflect all available information and therefore cannot be systematically outperformed by any individual investor - has been, for the better part of half a century, the central dogma of academic finance. Formulated in its…

• What practical consequences did the efficient market hypothesis have for financial policy?
• Why did the weaker forms of the efficient market hypothesis prove so durable?