One of the Primary Problems with the Principal Components Analysis

question 46

True/False

One of the primary problems with the principal components analysis of factor analysis is that it can take most of the variance to explain the first factor and leave little variance for other factors to explain.

---

Definitions:

Fair Value

What one would earn from selling an asset or what it would cost to shift a liability in a systematic operation with market actors on the appraisal date.

Guaranteed Residual Value

The predetermined value of a leased asset at the end of the lease term, guaranteed by the lessee or a third party.

Present Value Interest Factors

A factor that is used to determine the present value of a future sum or series of future payments, discounted at a specific interest rate.

Guaranteed Residual Value

The predetermined value at which a leased asset is guaranteed to be valued at the end of the lease term, affecting lease payments and accounting.