Assume That Stock Market Returns Do Follow a Single-Index Structure

question 30

Multiple Choice

Assume that stock market returns do follow a single-index structure. An investment fund analyzes 175 stocks in order to construct a mean-variance efficient portfolio constrained by 175 investments. They will need to calculate ________ estimates of expected returns and ________ estimates of sensitivity coefficients to the macroeconomic factor.

• A) 175; 15,225
• B) 175; 175
• C) 15,225; 175
• D) 15,225; 15,225

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Definitions:

Prions

Infectious agents composed of protein in a misfolded form, causing neurodegenerative diseases.

Virions

Complete virus particles that consist of an RNA or DNA core with a protein coat sometimes with external envelopes and that are the extracellular infective form of a virus.

DNA Polymerase

An enzyme that catalyzes the synthesis of new DNA strands from nucleotide precursors, essential for DNA replication and repair processes.

Retroviruses

A class of viruses that use reverse transcriptase to convert their RNA genome into DNA, integrating it into the host cell’s DNA for replication.