The Abnormal Return on a Security for a Particular Day

question 37

Multiple Choice

The abnormal return on a security for a particular day can be estimated by the equation:

• A) AR = R - R_m.
• B) AR = R_m- R.
• C) AR = R_m- R_f.
• D) AR = R - R_f.
• E) AR = R_f - R_m.

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Definitions:

Panel

A group of people gathered to discuss, analyze, or recommend on a particular subject matter or to conduct a study.

Intersection

The point or area where two or more lines or paths cross or meet.

Long-Run Equilibrium

A state in which all adjustments to any economic changes have been made, allowing for full resource flexibility and market adjustments.

Profit-Maximizing Price

The price level at which a firm maximizes its profits, typically found where marginal cost equals marginal revenue.