A Factor,as Used in APT,is a Variable That

question 46

Multiple Choice

A factor,as used in APT,is a variable that:

• A)represents a nondiversifiable risk.
• B)affects the returns of risky assets in an unsystematic fashion.
• C)correlates the returns of a risky asset with those of a risk-free asset.
• D)measures the response of a specific asset to a systematic risk.
• E)represents a firm-specific risk.

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Definitions:

Internal State

Refers to an individual's psychological or emotional condition at a specific time.

Preoccupied

In attachment theory, a state characterized by excessive worry about relationships, leading to anxiety and overly needy behavior.

Feeling Guilty

The emotional state of being culpable or remorseful for an action or thought, often associated with the violation of one’s moral or ethical standards.

Diffusion of Responsibility

A phenomenon where individuals are less likely to take action or feel a sense of responsibility when others are present.