Unlike the Capital Asset Pricing Model, the Arbitrage Pricing Theory

question 12

Multiple Choice

Unlike the capital asset pricing model, the arbitrage pricing theory requires only the following assumption(s) :

• A) A quadratic utility function.
• B) Normally distributed returns.
• C) The stochastic process generating asset returns can be represented by a factor model.
• D) A mean-variance efficient market portfolio consisting of all risky assets.
• E) All of the above

Apply the Kruskal-Wallis test to determine differences among more than two groups.

Distinguish between tests for matched pairs and tests for independent samples.

Understand the concept of nonparametric tests for ordinal or interval data not assuming normal distribution.

Interpret the results and critical values of nonparametric tests.