Question: 7-- which one is false for capital asset pricing model (CAPM)? A) CAPM assumes that only the systematic risk is rewarded in the market, and

7-- which one is false for capital asset pricing model (CAPM)?

A) CAPM assumes that only the systematic risk is rewarded in the market, and the unsystematic risk can be diversified by creating the market profolio

B) CAMP assumes the positive relation between risks and returns

C) CAMP can be used to forecast an expected return of individual security

D) CAMP has the same assumption of EMH as the fundamental analysis

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

Q:

Solutions Plus is an industrial chemicals company that produces specialized cleaning fluids and solvents for a wide variety of applications. Solutions Plus just received an invitation to submit a bid...

Q:

7-- which one is false for capital asset pricing model (CAPM)? A) CAPM assumes that only the systematic risk is rewarded in the market, and the unsystematic risk can be diversified by creating the...

Q:

Which one is false for capital asset pricing model (CAPM)? A. CAPM assumes that only the systematic risk is rewarded in the market, and the unsystematic risk can be diversified by creating the market...

Q:

Which one is false for capital asset pricing model (CAPM)? CAPM assumes that only the systematic risk is rewarded in the market, and the unsystematic risk can be diversified by creating the market...

Q:

The Capital Asset Pricing Model ( CAPM ) describes the relationship between systematic risk, or the general perils of investing, and expected return for assets, particularly stocks. The model is...

Q:

The Capital Asset Pricing Model (CAPM) describes the relationship between systematic risk and expected return for assets, particularly stocks. CAPM is widely used throughout finance for pricing risky...

Q:

Q1. (a). What is capital asset pricing model (CAPM) (41 (b). Distinguish between systematic risk and unsystematic risk and give one example each. (C). Differentiate between a nominal annual rate and...

Q:

Q1. (a). What is capital asset pricing model (CAPM) (41 (b). Distinguish between systematic risk and unsystematic risk and give one example each. (C). Differentiate between a nominal annual rate and...

Q:

Consider two stocks, stock A and B . We have annual return data for these two stocks along with the T Bill and market portfolio returns over the past 2 5 years. OBS. STOCK A STOCK B MARKET T BILL 1 6...

Q:

Consider two stocks, stock A and B . We have annual return data for these two stocks along with the T Bill and market portfolio returns over the past 2 5 years. OBS. STOCK A STOCK B MARKET T BILL 1 6...

Q:

The capital asset pricing model ( CAPM ) describes the relationship between systematic risk and expected returns for assets. It states that the expected return on an asset is equal to the risk - free...

Q:

The following data represent samples that were taken on 10 separate days. Each day has a varying sample size and the number of defects for the items sampled is listed. We want to see if this process...

Q:

The motion of a submarine is being studied in a laboratory. The prototype speed of interest is 5 m/sec in the ocean. Inertial forces and viscous forces govern the motion. At what theoretical speed...

Q:

the surface integral S F * d S for the given vector field F and the oriented surface S . In other wo F ( x , y , z ) = xyi y z j z x k Is the part of the parabolold z = 8 - x 2 - y 2 that lies above...

Q:

Figure Q3 shows the truth table and the digital circuit that computes the outputs sum and cout from the input bits a and b. In order to compute more complex arithmetic operations, you need to be able...

Q:

Briefly discuss the key steps in the personal selling process utilizing an example product or service of your choosing.

Q:

Read the book The Pelican Brief was written by John Grisham in 1992. It was published the same year by Doubleday, New York. Try to find further information about the author - reputation,...

Q:

Calculate the enthalpy and entropy of saturated isobutane vapor at 360 K from the following information: 1. Table 6.1 gives compressibility-factor data (values of Z) for isobutane vapor. 2. The vapor...

Q:

A machine with a book value of $250,000 has an estimated six-year life. A proposal is offered to sell the old machine for $243,000 and replace it with a new machine at a cost of $320,000. The new...

Q:

Inventory turnover is measured as average dollar sales volume at cost divided by annual dollar inventory investment. Group of answer choices True False

Q:

=+out the possible impacts on HR from such a move for the next city council meeting. What sorts of issue will you include in your briefing?

Q:

=+4. What might explain any differences that you identify?

Q:

=+2. Is there a strong collective bargaining culture in evidence?