Assume That You Are Embarking on a Test of the Small-Firm

question 5

Multiple Choice

Assume that you are embarking on a test of the small-firm effect using APT.You form 10 size-based portfolios.The following finding would suggest there is evidence supporting APT:

• A) The top five size based portfolios should have excess returns that exceed the bottom five size based portfolios.
• B) The bottom five size based portfolios should have excess returns that exceed the top five size based portfolios.
• C) The ten portfolios must have excess returns not significantly different from zero.
• D) The ten portfolios must have excess returns significantly different from zero.
• E) None of the above.

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Definitions:

Hard Influence Tactics

Strategies that use direct and forceful approaches to persuade others, often involving pressure or threats.

Assertiveness

The quality of being self-assured and confident without being aggressive, enabling an individual to express their thoughts and feelings in a direct, honest manner.

Ingratiation Activities

Behaviors aimed at gaining favor or approval from others, often through flattery or other forms of sycophancy.

Silent Authority

A form of power where someone complies with requests or orders based on the implicit power or position of the requester.