Which of the Following Are Not True Regarding the Treynor-Black

question 36

Multiple Choice

Which of the following are not true regarding the Treynor-Black model?

• A) It considers both macroeconomic and microeconomic risks.
• B) It considers security selection only.
• C) It is nearly impossible to implement.
• D) It considers both macroeconomic and microeconomic risks, and it is nearly impossible to implement.
• E) It considers security selection only, and it is nearly impossible to implement.

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Definitions:

Operating Assets

Assets used in the day-to-day operations of a business, such as machinery, buildings, and equipment, that contribute to revenue generation.

Operating Costs

The expenses associated with the operation of a business, excluding costs associated with production.

Working Capital

The difference between a company’s current assets and current liabilities, indicating its short-term financial health and operational efficiency.

Net Present Value

A calculation used to assess the profitability of an investment, considering the present value of its future cash flows minus the initial investment.