A Simple Random Sample of 28 Observations Was Taken from a Large

question 15

Multiple Choice

A simple random sample of 28 observations was taken from a large population. The sample mean equaled 50. Fifty is a

• A)population parameter
• B)biased estimate of the population mean
• C)sample parameter
• D)point estimate

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Definitions:

Security Market Line

A graphical representation in the Capital Asset Pricing Model that shows the relationship between the expected return of an investment and its beta, representing risk.

APT

Stands for Arbitrage Pricing Theory, a model that predicts a security's returns using the linear relationship between its expected return and macroeconomic factors.

Factor Intensity

The measure of how much of a certain factor of production (labor, capital, etc.) is used in the production of a good or service.

APT Model

Arbitrage Pricing Theory Model, an alternative to the Capital Asset Pricing Model (CAPM), asserts that the expected return of a financial asset can be modeled as a linear function of various macro-economic factors or theoretical market indexes.