Time-Weighted as Opposed to Dollar-Weighted Return Captures Rate of Return

question 19

True/False

Time-weighted as opposed to dollar-weighted return captures rate of return actually earned by the portfolio manager.

---

Definitions:

Direct Labor-hours

The sum of time spent by employees directly involved in the creation of a product, often used to allocate manufacturing costs.

Manufacturing Overhead

All indirect costs associated with the production process, including utilities, maintenance, and salaries of non-direct labor.

Predetermined Overhead Rate

A rate used to allocate indirect costs to products or services, calculated before the accounting period begins based on estimated costs and activity levels.

Direct Labor-hour

A metric that calculates the total number of hours worked by employees directly involved in manufacturing a product or providing a service.