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- Price Stability is most likely to be achieved during times ofBased on arguments made by Friedman and Fama, which of the following requirements must be fulfilled for noise traders to affect markets in equilibrium? Select all that apply. Noise traders must be able to survive economically for a significant period of time All traders must be risk averse Technical trading must be profitable at least some of the time Noise trader behavior must be systematicWhich is NOT true about the weak, semi-strong, and strong forms of the efficient markets? Under the weak form, only historical information is reflected in asset prices. Under the semi-strong form, both past and currently known information is reflected in prices. Under the strong form, all information, past and present, publicly known and private, is reflected in prices. Under all forms, price levels are quickly impacted by new information.
- Futures contracts are standardized agreements to buy or sell a commodity in a central market which specifies quantity and quality of the commodity, allowing for a highly efficient and low-cost method of price discovery. A. True B. FalseIn order to cope with high levels of supply uncertainty, a firm would use this strategy to reduce risk.True or False: Price-taker and price-searcher models necessarily fail to incorporate imperfect information and uncertainty into their assumptions.
- After the COVID-19 outbreak, a steep (very high) increase in demand for varlous products is reported as well as increases in retail prices. a. Could you explain why retail prices increase and justify your answer? b. Could you suggest a way for companies to increase or keep their profits unchanged without increasing the retail price of their products? Please justify your answer.What is advantage and disadvantage of economic prices for non tradable good in distorted marketsDiscuss price continuity as a characteristic of well-functioning market?