Question: 20 Efficient Markets Hypothesis TransTrust NV has changed how it accounts for inventory. Taxes are unaffected, although the resulting earnings report released is 20 per

20 Efficient Markets Hypothesis TransTrust NV has changed how it accounts for inventory. Taxes are unaffected, although the resulting earnings report released is 20 per cent higher than it would have been under the old accounting system. There is no other surprise in the earnings report, and the change in the accounting treatment was publicly announced. If the market is efficient, will the share price be higher when the market learns that the reported earnings are higher?

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