Which of the Following Factors Did Chen, Roll, and Ross

question 23

Multiple Choice

Which of the following factors did Chen, Roll, and Ross not include in their multifactor model?

• A) Change in industrial production
• B) Change in expected inflation
• C) Change in unanticipated inflation
• D) Excess return of long-term government bonds over T-bills
• E) All of the factors are included in the Chen, Roll, and Ross multifactor model.

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Definitions:

Reallocating Resources

The process of distributing resources, such as capital and labor, in a different manner to increase efficiency or achieve a specific objective.

Individual Behavior

The actions or reactions of an individual in response to external or internal stimuli.

Economists

Professionals who study the production, distribution, and consumption of goods and services, analyzing how economies work and how economic agents behave.

Assumption

A belief or statement taken for granted without proof, often forming the basis for further reasoning or arguments.