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According to the Index Model, Covariances Among Security Pairs Are

Question 74

Multiple Choice

According to the index model, covariances among security pairs are


A) due to the influence of a single common factor represented by the market index return.
B) extremely difficult to calculate.
C) related to industry-specific events.
D) usually positive.
E) due to the influence of a single common factor represented by the market index return and usually positive.

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