Zippy Computers announced strong fourth quarter results. Sales and earnings were both above analysts? expectations.

Description

QUESTION:

“Zippy Computers announced strong fourth quarter results. Sales and earnings were both above analysts? expectations. You notice in the newspaper that Zippy?s stock price went up sharply on the day of the announcement. If no other information about Zippy became public on the day of the announcement and the overall market was down, is this evidence of market efficiency?”

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Book Name:

Fundamentals of Corporate Finance, 4th Edition

Author:

Robert Parrino, David S. Kidwell, Thomas Bates, Stuart L. Gillan

Textbook Solution:

Solution Available in MS-Word File.