Strategies to Reduce Operational Costs Are Linked to Efficiency

question 59

True/False

Strategies to reduce operational costs are linked to efficiency.

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Definitions:

Risk-Free Return

The theoretical return attributed to an investment with zero risk, often represented by the yield on government securities.

Jensen Measure

A risk-adjusted performance measure that calculates the average return on a portfolio or fund over and above that predicted by the Capital Asset Pricing Model (CAPM), given the portfolio's or fund's risk.

Market Portfolio

A theoretical bundle of investments that includes every asset in the market, weighted by market capitalization; often used as a benchmark in the capital asset pricing model (CAPM).

Risk-Free Return

The return on an investment with no loss of principal, often associated with government bonds.