Which of the Following Statements Is FALSE

question 60

Multiple Choice

Which of the following statements is FALSE?

• A)The risk premium of any marketable security can be written as the sum of the risk premium of each factor multiplied by the sensitivity of the stock with that factor.
• B)The factor betas measure the sensitivity of the stock to a particular factor.
• C)If we use more than one portfolio as factors,then together these factors will capture systematic risk,but each factor captures different components of the systematic risk.
• D)When we use more than one portfolio to capture risk,the model is known as a single-factor model.

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Definitions:

Mortality

The state of being mortal or the incidence of death within a population.

Life Expectancy

The average number of years an individual is expected to live, based on statistical averages for a particular population or demographic.

Health Expectancy

An estimate of how many years a person can expect to live in a state of good health, taking into account morbidity and disability rates.

PPACA

The Patient Protection and Affordable Care Act, a U.S. law enacted in 2010 aimed at expanding health insurance coverage, reducing healthcare costs, and improving healthcare system efficiency.