In the Treynor-Black Model,the Active Portfolio Will Contain Stocks with __________

question 75

Multiple Choice

In the Treynor-Black model,the active portfolio will contain stocks with __________.

• A) alphas equal to zero
• B) negative alphas
• C) positive alphas
• D) some negative and some positive alphas

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Definitions:

Marginal Cost

Marginal cost is the cost of producing one additional unit of a product or service, vital for pricing and production decisions.

Marginal Benefit

The added value or enjoyment derived from the consumption of an extra unit of a good or service.

Rational Decisionmaker

An individual who makes choices that maximize their benefits while minimizing costs, based on available information and rational assessment.

Fuel-efficient Cars

Vehicles designed to use less fuel for traveling the same distance compared to standard vehicles, reducing operating costs and environmental impact.