Amongst the following options given below, what may be a possible limit on arbitrage activity that may allow mispricing to persist. Explain a valid reasoning behind your choice. points] Technical trends in prices Momentum Implementation costs Trend Reversals Prospect Theory If the simple CAPM is valid, will the situation given below will be possible? Explain. [3 points] Portfolio Risk- free Expected Return 10% Standard Deviation 0% 24% 22% Market GSK 18% 16% Choose from the following: An implication of the efficient market hypothesis is that [3 points] i. high beta stocks are consistently overpriced ii. low beta stocks are consistently overpriced iii. the single index model is better than the CAPM iv. nonzero alphas will quickly be exploited and disappear v. all investors should buy growth stocks Amongst the following options given below, what may be a possible limit on arbitrage activity that may allow mispricing to persist. Explain a valid reasoning behind your choice. points] Technical trends in prices Momentum Implementation costs Trend Reversals Prospect Theory If the simple CAPM is valid, will the situation given below will be possible? Explain. [3 points] Portfolio Risk- free Expected Return 10% Standard Deviation 0% 24% 22% Market GSK 18% 16% Choose from the following: An implication of the efficient market hypothesis is that [3 points] i. high beta stocks are consistently overpriced ii. low beta stocks are consistently overpriced iii. the single index model is better than the CAPM iv. nonzero alphas will quickly be exploited and disappear v. all investors should buy growth stocks