The Two-Factor Model for Security X Is 3% + L

question 7

Multiple Choice

The two-factor model for Security X is 3% + l.5(GDP) - 2(CPI) and for Security Y is 4% + 2(GDP) - .8(CPI) . An analyst forecasts GDP at 4% and CPI at 5% with respective variances of 8% and 3%. Covariance (GDP, CPI) is .6. The covariance between Securities X and Y is

• A) 25.7.
• B) 28.8.
• C)g.6.
• D) 33.6.

---

Definitions:

Statement Questionnaires

Tools consisting of a series of written questions used for collecting information from respondents.

Response Tracking

The process of monitoring and measuring the reactions or responses to marketing campaigns, products, or services.

Monthly Bill

A statement that outlines charges incurred during a month for services or products, requiring payment.

Personal-Selling Process

A direct marketing approach that involves face-to-face interaction between a salesperson and potential customers to engage and convert them into buyers.