Question

How do information systems affect Market Efficiency?

Answer 1

Information system affect Market Efficiency in the following Way:

*Availability of accurate information at the right time, give the market to exploit the opportunity to earn maximum profit.

*Investors are able to invest in securities when correct information is provided which in turn leads to bullish the market.

*When accurate information is provided to all players or participants of the market like shareholders, creditors, government leads to fair buying and selling of securities and

*Thus leading to limit the insider trading when sensitive information is accessible only to few insiders.