Question: explain why 8. Choose a false statement and give explanation. a. Betas represent security's responsiveness to market in index model b. Index model relates stock

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8. Choose a false statement and give explanation. a. Betas represent security's responsiveness to market in index model b. Index model relates stock returns to returns on firm specific factors. C. SCL is a plot of security's predicted excess return from excess return of market. d. Firm-specific risk is the component of return variance independent of market factor

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