What question did this study set out to answer?

The aim is to compare two methodologies for assessing market reactions to accounting policy changes.

Market Reactions to Accounting Policy Deliberations: The Inflation Accounting Case Revisited - A Reply.

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This reply evaluates differing methodologies for analyzing market reactions, suggesting balanced use of both methods.

The aim is to compare two methodologies for assessing market reactions to accounting policy changes.
Discussed Basu and N&S methodologies focusing on test statistic, significance levels, and sampling methods.
Examined the use of correlations as a test statistic and empirical distribution for significance calculations.
Considered testing correlations between abnormal returns across multiple 'partitioning' events.
Neither methodology is deemed superior; each has its strengths.
Future research could leverage the best features of both methodologies.

Noreen et al. (1981) studied this question.

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