The Arbitrage Pricing Theory (APT) Differs from the Capital Asset

question 63

Multiple Choice

The arbitrage pricing theory (APT) differs from the capital asset pricing model (CAPM) in that it suggests that stock prices

• A)are influenced only by the market itself.
• B)can be influenced by a set of factors in addition to the market.
• C)are not influenced at all by the market.
• D)cannot be influenced at all by the industry factors.

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Definitions:

Medical Instruments

Tools and devices used in the practice of medicine for diagnosis, prevention, and treatment of diseases.

P-Value

The likelihood of encountering test outcomes as significant as or more than the actual observed results, assuming the null hypothesis is valid.

Null Hypothesis

The proposition that observed differences among specific populations are attributed to errors in sampling or experimentation, hence indicating no major divergence.

Level Of Significance

The threshold chosen for deciding whether an observed effect is statistically significant, usually denoted by alpha.