The term Corr(ε R,ε T) = 0 tells us that:
A) the error terms of company R and T are 0.
B) the unsystematic risk of companies R and T is unrelated or uncorrelated.
C) the correlation between the returns of companies R and T is greater than zero.
D) the systematic risk companies R and T is unrelated.
Correct Answer:
Verified
Q1: The single factor APT model that resembles
Q1: A factor is a variable that:
A) affects
Q4: Systematic risk is defined as:
A) a risk
Q5: The unexpected return on a security, U,
Q7: For a diversified portfolio including a large
Q8: If company A makes a new product
Q14: Shareholders discount many corporate announcements because of
Q22: To estimate the required return for a
Q34: The acronym APT stands for:
A) Above Par
Q39: Style portfolios are characterized by:
A) their stock
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