The Factor F in the APT Model Represents

question 49

Multiple Choice

The factor F in the APT model represents

• A) firm-specific risk.
• B) the sensitivity of the firm to that factor.
• C) a factor that affects all security returns.
• D) the deviation from its expected value of a factor that affects all security returns.
• E) a random amount of return attributable to firm events.

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Definitions:

Cultural Change

The transformation of a society's norms, values, beliefs, and practices over time.

American Stores

historically refers to a chain of supermarkets and drugstores in the United States, illustrating an example of retail business operation.

Diffusion

The spread of cultural elements, ideas, technologies, or innovations from one area or social group to another.

Invention/Innovation

Occurs when existing cultural items are manipulated or modified to produce something new and socially valuable.