Question: points) CAPM and Implications If the Capital Asset Pricing Model (CAPM) is valid. Please provide your assessment of the following two situations. Are they possible?

points) CAPM and Implications If the Capital Asset Pricing Model (CAPM)

points) CAPM and Implications If the Capital Asset Pricing Model (CAPM) is valid. Please provide your assessment of the following two situations. Are they possible? Explain. Consider each independently Situation 1. Portfolio Expected Return Risk-free asset Standard deviation 10% 0% Market portfolio 18% 24% Stock A 16% 12% Situation 2. Beta Expected Return Portfolio 0 10% Risk-free asset 1.0 18% Market portfolio 0.90 16% Stock A

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