Consider the Single Factor APT

question 87

Multiple Choice

Consider the single factor APT. Portfolio A has a beta of .2 and an expected return of 13%. Portfolio B has a beta of .4 and an expected return of 15%. The risk-free rate of return is 10%. If you wanted to take advantage of an arbitrage opportunity, you should take a short position in portfolio ________ and a long position in portfolio ________.

• A) A; A
• B) A; B
• C) B; A
• D) B; B

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Definitions:

Gender Distinctions

Socially and culturally constructed differences between males and females, often based on attributes, roles, and expectations.

Interactional

Pertaining to or involving interaction between individuals or entities.

Societal

Pertaining to or involving society and its institutions, norms, and values.

Sex Discrimination

Unfair treatment of individuals based on their sex or gender, often manifesting in areas such as employment, education, and healthcare.