A Purely Passive Strategy Is Defined as

question 48

Multiple Choice

A purely passive strategy is defined as

• A) one that uses only index funds.
• B) one that allocates assets in fixed proportions that do not vary with market conditions.
• C) one that is mean-variance efficient.
• D) one that uses only index funds and allocates assets in fixed proportions that do not vary with market
• E) All of the options are correct.

Recognize the concept and execution of the PDCA (Plan-Do-Check-Act) cycle.

Identify techniques that facilitate equal participation and reduce hierarchical barriers in problem-solving within groups.

Describe the role of divergent thinking in creative problem solving.

Explain the concept and importance of collaborative decision-making and the principles that support effective collaboration.

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Definitions:

Leverage

Utilizing borrowed funds or debt to enhance the possible returns from an investment.

EBIT

Earnings Before Interest and Taxes, a measure of a firm's profit that includes all expenses except interest and income tax expenses.

WACC

Weighted Average Cost of Capital, a calculation used to estimate the average cost of a company's financing including equity and debt, reflecting the risk of investments.

Unlevered Return

The return on an investment that has not been adjusted for the effects of leverage or borrowing.