The correct answer is: C. inefficient market hypothesis
The efficient market hypothesis (EMH) is a theory that states that asset prices reflect all available information. This means that it is impossible to consistently outperform the market by using publicly available information.
The EMH is based on the assumption that markets are efficient, meaning that prices reflect all available information. This means that it is impossible to consistently outperform the market by using publicly available information.
There are three forms of the EMH: weak, semi-strong, and strong. The weak form of the EMH states that past prices cannot be used to predict future prices. The semi-strong form of the EMH states that all publicly available information is reflected in prices. The strong form of the EMH states that all information, including private information, is reflected in prices.
The EMH is a controversial theory, and there is no consensus among economists on whether it is true or false. However, the EMH is an important theory in finance, and it has been used to develop many investment strategies.
The inefficient market hypothesis (IMH) is a theory that states that asset prices do not always reflect all available information. This means that it is possible to consistently outperform the market by using information that is not publicly available.
The IMH is based on the assumption that markets are not always efficient, meaning that prices do not always reflect all available information. This can happen for a number of reasons, such as when investors are irrational or when there is asymmetric information.
There are a number of different theories that explain why markets may be inefficient. One theory is that investors are often irrational and make decisions based on emotion rather than logic. Another theory is that there is often asymmetric information in the market, meaning that some investors have more information than others.
The IMH is a controversial theory, and there is no consensus among economists on whether it is true or false. However, the IMH is an important theory in finance, and it has been used to develop a number of investment strategies.