Answer: Arbitrageurs conducting arbitrage

Hull’s explanation is that arbitrage opportunities do not last because **arbitrageurs quickly exploit them**. Once an obvious mispricing appears, traders enter the market to take the opposite side of the mispricing. Their trading pressure helps bring prices back into line, so the opportunity disappears. - **Efficient markets** are a broader outcome, but not the immediate mechanism. - **Transaction costs** can limit arbitrage, but they do not explain why opportunities vanish so quickly. - **Information technology** may speed up the process, but the key driver is still arbitrageurs acting on the mispricing. So the best answer is **B**.

Author: Manit Arora