Answer: B. prices of actively traded stocks do not differ from their true values in an efficient market
Explanation: The efficient market theory postulates that the market is generally efficient with prices of actively traded stocks do not differ from their true values in an efficient market. As a result, prices of securities such as stocks reflect all available information, thus making it needles to engage in stock picking with hopes to "beat the market" on a risk-adjusted basis. This is because the market only reacts to new information.