If Rp = Fund Return, Rf = the Risk- Free

question 65

True/False

If Rp = fund return, Rf = the risk- free return, Rm = the market return, and Bp = the beta of the fund, then the fund's alpha statistic is defined as Rm - Bp(Rf - Rp).

---

Definitions:

Output

The amount of goods or services produced by a person, machine, factory, country, etc.

Marginal Cost Curve

A graph that displays the cost of producing each additional unit, typically showing how marginal cost changes as production increases.

Average Total Cost (ATC)

The total cost of production divided by the quantity of output produced, representing the per unit cost of production.

Average Variable Cost (AVC)

The total variable costs of production (like labor and material costs) divided by the quantity of output produced, indicating the average variable expense per unit of output.