1.

The Arbitrage Pricing Theory (APT) model:

Select one:

a. was one of the first models developed by Harry Markowitz

b. allows investors to arbitrage profits

c. is illegal in most countries

d. is a good forecasting model, because the factors are completely independent (orthogonal)

e. is limited in usefulness due to unknown factors

2.

Stewart has been hired by Goodner Industries, Inc., to manage its pension fund. Stewart's fiduciary duty is owed to:

Select one:

a. each of the above equally.

b. the management of Goodner.

c. the shareholders of Goodner.

d. the participants and beneficiaries of Goodner's pension plan.