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A)	only psychological reasons for stock price changes.

B)	both psychological and economic reasons for stock price changes.

C)	neither psychological nor economic reasons for stock price changes.

One advantage of technical analysis is that it incorporates both psychological and economic reasons for stock price changes.

A)	It does not depend on the analysis of market trading data, such as security prices and trading volume.

B)	It tells the analyst when to buy, but not necessarily why investors are buying.

C)	It is relatively easy to implement.

Technical analysis depends almost entirely on the analysis of data derived from stock market trading activity, including security prices and trading volume. It does not depend on accounting information.

A)	ease in interpreting reasons behind stock price trends.

B)	complete objectivity.

C)	the incorporation of psychological reasons behind price changes.

Technical analysis avoids having to use fundamental data and adjusting for accounting problems, incorporates psychological as well as economic reasons behind price changes, and tells WHEN to buy; not WHY investors are buying. Drawbacks include subjective interpretation of charts and graphs.

A)	why investors are buying.

B)	when to buy; not why investors are buying.

C)	only the economic reasons behind price changes.

The four advantages of technical analysis are: it's quick and easy; it does not involve adjusting for accounting problems; it incorporates psychological as well as economic reasons behind price changes; and it tells when to buy, not why investors are buying.

The fact that it is not heavily dependent on the analysis of accounting information is an advantage of:

One advantage of technical analysis is that it does not involve messing with financial accounting information and adjusting for management choice of accounting methods.

Most empirical studies of technical trading rules have found that past stock price patterns:

A)	repeat, and therefore technical analysis is profitable.

B)	may not repeat, and therefore technical analysis is not profitable.

C)	may not repeat, and therefore technical analysis is profitable.

The vast majority of studies have found that prices do not move in trends based on statistical tests of autocorrelation and runs. That is, past price patterns may not be repeated in the future. Efficient market followers say that the market appears to react quickly to the release of new information. This is a significant challenge to technical analysis.

If a technical trading rule is successful in generating excess returns, the value of the trading strategy will most likely:

A)	disappear as competition among technical traders using the rule increases and excess profits are traded away.

B)	increase as competition among technical traders using the rule increases and the self-fulfilling prophecy causes stock prices to increase.

C)	decrease but not disappear completely because only a few technical traders will have the skill to use the successful rule.

If a technical trading proved to be successful, others would copy it. As more traders implement the strategy, its value will be neutralized. This is a significant challenge to technical analysis.

A)	Interpreting technical trading rules is too subjective and the decision variables change over time.

B)	Price patterns can become self-fulfilling prophecies.

C)	During the 1990s the accounting profession continually changed and updated the generally accepted accounting principles (GAAP), making analysis of accounting information more difficult than it had been historically.

A)	Interpreting technical trading rules is too subjective and the decision variables change over time.

B)	Price patterns can become self-fulfilling prophecies.

C)	During the 1990s the accounting profession continually changed and updated the generally accepted accounting principles (GAAP), making analysis of accounting information more difficult than it had been historically.