The basis of the efficient market hypothesis

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1. Discuss the relationship between rational expectations and random walk theory and how they form the basis of the Efficient Market Hypothesis.

2. A company bought a machine for $111,000. The machine was depriciated using a 5 year MACRS approach. After 5 years, the machine was sold at a salvage value of $96,300. Assuming a tax rate of 32%, what are the net proceeds from the sale of the machine?

3. A company sells 123,799 units per year. Fixed costs per order are $136 and carrying cost is $20 per unit per year. If management uses an EOQ model, how many orders will it place per year?

Reference no: EM131986941

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