Which of the Following Factors Were Used by Fama and French

question 14

Multiple Choice

Which of the following factors were used by Fama and French in their multifactor model?

• A)Return on the market index
• B)Excess return of small stocks over large stocks
• C)Excess return of high book-to-market stocks over low book-to-market stocks
• D)All of the factors were included in their model.

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Definitions:

Income Effect

How an alteration in the income of an individual or an economy influences the demand for a specific good or service.

Legal Hourly Minimum Wage

The lowest hourly pay that employers are legally allowed to pay their workers, as mandated by government law.

Secondary Labor Market

Employment sectors characterized by low pay, low job security, and poor working conditions, often distinguished from primary sectors which offer better employment conditions.

Primary Labor Market

Refers to high-skilled, high-paying jobs that usually require a higher level of education or training, often offering benefits and job security.