4.13. 

(a) What are three of the biggest drawbacks of using macroeconomic factors?

(b) What is one of the biggest benefits of using economic factors in stock-return models?

CHAPTER 4: Factors and Factor Choice 133

Date Price

7/13/2004 11.31 7/14/2004 11.41 7/15/2004 11.28 7/16/2004 11.57 7/19/2004 11.43 7/20/2004 11.41 7/21/2004 10.92 7/22/2004 10.51 7/23/2004 10.35 7/26/2004 9.35 7/27/2004 9.65 7/28/2004 10.01 7/29/2004 9.67