Unlike the CAPM, the APT Does Not Assume Borrowing and Lending

question 2

True/False

Unlike the CAPM, the APT does not assume borrowing and lending at the risk-free rate.

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Definitions:

Day-to-Day Activities

The regular or routine actions that individuals undertake on a daily basis for personal or professional purposes.

Income

The financial gain obtained by an individual or entity from work, investment, or other sources.

Disabled-Parking Passes

Permits issued to individuals with disabilities that allow them to park in designated spaces close to building entrances for easier access.

Efficiency

The extent to which resources are allocated in the most effective manner, maximizing output from a set of inputs.