What might lead to markets becoming less efficient


Problem: The theory of market efficiency is based on the premise that a market is considered efficient when stock prices are an actual reflection of information known about a company. U.S. markets are generally viewed as semi-strong form market efficient.

QUESTIONS:

1) What would happen if U.S. markets became less efficient?

2) What might lead to markets becoming less efficient?

3) How do markets in other countries compare to the U.S. in terms of efficiency?

Please include references.

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Finance Basics: What might lead to markets becoming less efficient
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