Multiple Choice
In the single-index model represented by the equation ri= E(ri) + βiF + ei,the term ei represents
A) the impact of unanticipated macroeconomic events on security i's return.
B) the impact of unanticipated firm-specific events on security i's return.
C) the impact of anticipated macroeconomic events on security i's return.
D) the impact of anticipated firm-specific events on security i's return.
E) the impact of changes in the market on security i's return.
Correct Answer:
Verified
Correct Answer:
Verified
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