Question

Explain market efficiency and the variables that make it up.

Answer 1

Market efficiency describes how effectively currency prices reflect all the variables and feasible information about the true value of underlying assets. Variable counts much to give the efficiency to market and also a positive and negative mindset for business projections.

Market efficiency refers to the ability of markets to incorporate information which gives the maximum numbers of opportunities to buyers and sellers of securities to effect transactions without increasing transaction costs.

Variable like information, major happening, government decision, disaster, pandemic, war, and other policies and procedures that bond the businesses or free the business that affects the market efficiency.