Banz (1981)has Evidenced a Trading Strategy in the USA That

question 40

Multiple Choice

Banz (1981) has evidenced a trading strategy in the USA that can earn risk-adjusted profits of around 20% by taking:

• A) long positions in a portfolio of large firms and short positions in a portfolio of small firms
• B) short positions in a portfolio of large firms and long positions in a portfolio of small firms
• C) short positions in a portfolio of small firms and long positions in a portfolio of large firms
• D) long positions in a portfolio of small firms and short positions in a portfolio of large firms

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Definitions:

Estimated Time

The approximation of the time required to complete a specific task or project.

Underapplied Manufacturing Overhead

Occurs when the allocated manufacturing overhead costs are less than the actual overhead costs incurred, resulting in a cost variance.

Prorated

Dividing or allocating amounts proportionally based on specific metrics or criteria, often used in billing and cost sharing.

Overapplied Manufacturing Overhead

A situation where the allocated manufacturing overhead cost is greater than the actual overhead incurred.