Factor Analysis

question 19

Multiple Choice

Factor analysis:

• A)uses macroeconomic time-series that capture changes in productivity,interest rates and inflation to act as proxies for the factors generating security returns.
• B)is a statistical estimation technique based on the idea that the covariances between security returns provide information that can be used to determine the common factors that generate the returns.
• C)establishes the correlation between the changes in one factor and the undiversifiable risk.
• D)assumes that there is no correlation between the factors which affect the price of securities.

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Definitions:

Self-Confidence

The belief in one's abilities, skills, and capacity to succeed.

Agreeableness

A personality trait characterized by kindness, cooperation, and a willingness to accommodate others.

Trait Approach

A theory in personality and leadership that attributes a person’s behavior to their inherent traits or characteristics.

21st Century Leadership

Emphasizes flexibility, collaboration, technology integration, and diversity to address today's complex challenges.