Exhibit 9.1 Use the Information Below for the Following Problem(S)

question 33

Multiple Choice

Exhibit 9.1
Use the Information Below for the Following Problem(S)
(1) Capital markets are perfectly competitive.
(2) Quadratic utility function.
(3) Investors prefer more wealth to less wealth with certainty.
(4) Normally distributed security returns.
(5) Representation as a K factor model.
(6) A market portfolio that is mean-variance efficient.
-Refer to Exhibit 9.1.In the list above,which are not assumptions of the Arbitrage Pricing model?

• A) (1) and (3)
• B) (1), (2), and (3)
• C) (1), (2), and (5)
• D) (2), (4), and (6)
• E) All six are assumptions

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Definitions:

Attitude Change

A shift in an individual's feelings, beliefs, or position on a topic due to various influencers, such as new information or social pressure.

Circadian Rhythm

The approximately 24-hour cycle in the physiological processes of living beings, influencing sleep-wake patterns, hormone release, and other bodily functions.

Paradoxical Sleep

Another term for REM (Rapid Eye Movement) sleep, characterized by the paradox of the brain being highly active while the body is immobilized.

Retina

A light-sensitive layer at the back of the eyeball that contains cells responsive to visual stimuli.