Instructions – PLEASE READ THEM CAREFULLY The Assignment must be submitted only

Instructions – PLEASE READ THEM CAREFULLY
The Assignment must be submitted only in WORD format
Students are advised to make their work clear and well presented; marks may be reduced for poor presentation
Students must mention question number clearly in their answer.
Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
Follow the words count in each question.
Use at least 3 APA style references.
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Assignment Purposes/Learning Outcomes:

Discuss implications of the efficient market hypothesis for the allocation of funds.
Assignment questions: Total grade – 10 points

The efficient market hypothesis (EMH) has numerous applications to the real world. It is especially valuable because it can be applied directly to an issue that concerns managers of financial institutions and general public as well.
Question 1: What is the efficient market hypothesis? discuss in brief the important evidence in favor and in against the market efficiency
(5 points).
(450 – 500 words)
Question 2: Answer the following questions:
A.Suppose that you have just read in a reputed journal that investment advisors are predicting a boom in oil stocks because an oil shortage is developing. Should you proceed to withdraw all your hard-earned savings from the bank and invest it in oil stock? Explain your action.
(1 point)
(350 – 450 words)
B.Suppose that your broker phones you with a hot tip to buy stock in the Ahmed Feet corporation (AFC) because it has just developed a product that is completely effective in curing athlete’s foot. The stock price is sure to go up. Should you follow this advice and buy AFC stock? Explain your action.
(1 point)
(350 – 450 words)
C.Do Stock Prices always rise when there is good news? Discuss.
(1 point)
(350 – 450 words)
D.Prepare a practical guideline for small investors who want to invest in the stock market, the guideline should provide a better understanding of the use and implications of the efficient market hypothesis.
(2 points)
(350 – 450 words)