Some Common Characteristics of the Relevant Factors of APT Models

question 21

Multiple Choice

Some common characteristics of the relevant factors of APT models include all of the following EXCEPT

• A) broad economic variables
• B) the price of gold
• C) the term structure of interest rates
• D) corporate earnings and dividends

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Definitions:

Invisible Hand Principle

Adam Smith's concept that self-interested behaviors in a free-market economy lead to economic benefits for all.

Competitive Markets

Markets characterized by a high level of competition where no single buyer or seller can influence prices significantly, leading to efficient distribution of resources.

General Welfare

General welfare refers to the overall health, prosperity, and happiness of a population.

Invisible Hand Principle

Adam Smith's concept that individuals' self-interested actions can lead to positive social and economic outcomes, guided as if by an invisible hand.