Macro Events Only Are Reflected in the Performance of the Market

question 90

Multiple Choice

Macro events only are reflected in the performance of the market portfolio because:

• A)The market portfolio has no individual firms
• B)Only macro events are tracked by economists
• C)Unique risks have been diversified away
• D)Firm-specific events would be too numerous to list

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Definitions:

Personal Income Tax

A tax levied by government on individuals or households based on their total yearly income from all sources.

Consortium

A group of companies or institutions formed to undertake an enterprise or project together, often pooling resources for a common goal.

Market Advantage

Market advantage refers to a strategic edge one company holds over competitors within its industry or market, often leading to stronger sales or brand loyalty.

Corporation

A legal entity that is separate and distinct from its owners, who are shareholders, and is recognized as such by law with rights and liabilities that are distinct from those of its members.