Quarterly Returns Were Forecasted for a Mutual Fund Made Up

question 10

Multiple Choice

Quarterly returns were forecasted for a mutual fund made up of technology stocks. The forecast errors for the last six quarters are as follows: -0.47, 1.12, -0.85, 1.27, 0.07, and -0.05. The MAD based on these forecast errors is

• A) 0.77.
• B) 0.98.
• C) 0.22.
• D) 0.18.
• E) 0.64.

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Definitions:

Dodd-Frank Act of 2010

a comprehensive and complex piece of financial reform legislation passed in 2010 in the United States, aimed at preventing the repeat of the financial crisis of 2008.

Securities and Exchange Commission

A U.S. federal agency responsible for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other related activities.

Asset-backed Securities

Financial instruments backed by a pool of assets, such as loans or receivables, which generate revenue for investors.

Executive Compensation

The financial pay and benefits provided to executives, including salaries, bonuses, stocks, and other compensation forms.