The Excess Return Form of the Single-Index Market Model Is

question 30

Multiple Choice

The excess return form of the single-index market model is

• A) R_it =α + b(R_mt - R_it) + e_it
• B) RFR_t = α + b(R_mt - RFR_t) + e_it
• C) R_it - RFR_t = α + b(R_mt) + e_it
• D) R_it = α + b(R_mt - RFR_t) + e_it
• E) R_it - RFR_t = α + b(R_mt - RFR_t) + e_it

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Definitions:

Psychodynamic

A therapeutic approach emphasizing the role of the unconscious mind, past experiences, and interpersonal relationships in shaping behavior and feelings.

Conditioning

A process of behavior modification by which a subject comes to associate a desired behavior with a previously unrelated stimulus.

Cognitive-behavioral

A therapeutic approach that aims to solve problems concerning dysfunctional emotions, behaviors, and cognitions through a goal-oriented, systematic procedure.

Humanistic-existential

A psychological approach focusing on individual experience, personal freedom, and the meaning of life.