Jack Is Performing a Factor Analysis on Twenty Items Relevant

question 60

Multiple Choice

Jack is performing a factor analysis on twenty items relevant to perceptions of service quality.Using a principal components approach,the following eigenvalues were produced: 3.45,2.78,1.33,1.24,1.01,.567,.443,and .223.How many factors should Jack retain based on these eigenvalues?

• A) 1
• B) 2
• C) 3
• D) 5
• E) 8

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Definitions:

Overpriced

A situation where a security or asset is trading at a price higher than its intrinsic value or fair value.

Sell

To transfer ownership of a security or other asset in exchange for money or value.

Stocks

Shares of ownership in a company that entitle the shareholder to a proportion of the company's profits and assets.

T-bond Futures

Futures contracts that obligate the buyer to purchase Treasury bonds at a specified price at a future date.