Question: Empirically, CAPM model is tested by a. Running a linear regression of historical returns of a stock on historical returns of the market portfolio b.

Empirically, CAPM model is tested by

Running a linear regression of historical returns of a stock on historical returns of the market portfolio

Running linear regressions of historical returns of stocks on historicalreturns of the market portfolio and then running a linear regression of historical mean of stock returns on stocks' beta found in the first regressions

Running a linear regression of historical mean of stock returns on stocks' beta and then running linear regressions of historical returns of stocks on historical returns of the market portfolio

Running a linear regression of historical mean of stock returns on stocks' beta

None of the above

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