In a Factor Model, the Variable "B" Measures the

question 44

Multiple Choice

In a factor model, the variable "B" measures the

• A) sensitivity to the factor.
• B) riskfree rate.
• C) unique return of the security.
• D) random error

---

Definitions:

Tax-Exempt Interest

This is interest income that is not subject to federal income tax, and in some cases, state or local taxes. Such interest is often earned from bonds issued by municipal, state, or other government entities.

Educational Assistance

Programs or benefits provided by employers or the government to help cover education expenses for students.

Fringe Benefit

Additional compensation provided to employees beyond their normal wages, such as health insurance, company cars, or retirement plans.

Employer-Paid Premiums

Payments made by an employer towards their employees' health insurance or other benefits, usually part of an employee's compensation package.