The systematic response coefficient for productivity,β_p,would produce an unexpected change in any security return of [β_P × ________] if the expected rate of productivity was 1.8 percent and the actual rate was 2.2 percent.

Question

Quizplus · Accepted Answer

The systematic response coefficient for productivity indicates how much the return of a security would change in response to a change in productivity. Given the expected rate of productivity was 1.8 percent and the actual rate was 2.2 percent, the change in productivity is 2.2 - 1.8 = 0.4 percent. Therefore, the unexpected change in any security return would be β_p × 0.4 percent.

The Systematic Response Coefficient for Productivity,βp,would Produce an Unexpected Change

The Systematic Response Coefficient for Productivity,β_p,would Produce an Unexpected Change