Digital SAT Reading and Writing Practice Question #582

Text 1 The Efficient Market Hypothesis (EMH) posits that financial markets are profoundly rational entities. According to strict interpretations of this theory, the price of any given stock perfectly reflects all publicly available information at any moment. Consequently, it is theoretically impossible for an investor to consistently outperform the overall market by analyzing past pricing data or public financial reports, as any new information that could influence a company's true value is instantaneously priced into the stock by lightning-fast institutional trading algorithms. Text 2 Behavioral economists have long criticized the traditional models of market efficiency, arguing that they critically ignore the reality of human psychology. While it is true that data is rapidly disseminated, human participants—driven by cognitive biases, herd mentality, and emotional extremes of panic and euphoria—often process this data irrationally. This systemic irrationality generates predictable cycles of market bubbles and devastating crashes, creating massive disparities between a stock's trading price and its intrinsic fundamental value. Based on the texts, how would the author of Text 2 most likely respond to the assertion in Text 1 that stock prices "perfectly reflect all publicly available information"?