Answer (B) is correct . The EMH states that stock prices reflect all relevant information, so the market is continuously adjusting to new information. Stock prices are in equilibrium, so investors cannot earn abnormal returns. The strong form of the EMH states that all public and private information is instantaneously reflected in current market prices of securities. Thus, investors cannot earn abnormal returns.
Answer (A) is incorrect because The semistrong form of EMH states that only publicly available information is reflected in current market prices.
Answer (C) is incorrect because The EMH states that current market prices at least reflect past price movements.
Answer (D) is incorrect because The weak form of the EMH states that only past price movements are reflected in current market prices.
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