Use the Equation for the Question(s) Below

question 2

Multiple Choice

Use the equation for the question(s) below.
Consider the following factor model:
E[R_s] - r_f = (E[R_Mkt] - r_f) + E[R_SMB] + E[R_HML] + E[RPR1 YR]
-The term measures the sensitivity of the securities' returns to

• A) momentum.
• B) the overall market.
• C) book-to-market.
• D) size.

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Definitions:

College Sophomores

A demographic often used in psychological and educational research, referring to students in their second year of college.

Test Grades

Numerical or letter indicators used to evaluate a student's performance on exams or assessments.

Correlation Coefficient

A numerical measure that indicates the extent to which two variables fluctuate together.

Relationship Variables

Factors that define the nature or characteristics of interactions between entities or individuals.