Asked by Deneatra Caesar on Jun 10, 2024

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​The information conveyed by changes in market prices is especially important in financial markets because

A) ​It forces individual investors to reveal their information about the prospects of a security
B) It assesses business decisions
C) It helps firms forecast the future demand for products
D) ​All of the above

Financial Markets

Marketplaces where individuals and entities can trade financial securities, commodities, and other fungible items of value at low transaction costs and at prices that reflect supply and demand.

Market Prices

The current price at which an asset or service can be bought or sold in a competitive marketplace.

Security Prospects

The potential for growth or return in investments related to the security or safety of assets.

  • Understand the role of price in signaling information within financial markets.
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Yasmin KhaleelJun 12, 2024
Final Answer :
D
Explanation :
Changes in market prices can indicate the sum of investors' opinions and beliefs about the future performance of a security or a product. This makes it necessary for individual investors to reveal their information, and helps firms forecast the future demand for products. It also assesses business decisions, such as the effectiveness of the management's decisions or the quality of a new product launch. Therefore, all of the above options are correct.