QUESTION 3 True or false? The previous solution for theta, in a model allowing riskless lending-borrowing and short sales, is also subject to one constraint. That constraint is: N XR = 1 ml True False QUESTION 4 Which are assumptions of the single-index model Select each statement that applies The only reason the returns to securities covary is because of their common response to market movements Industry effects may cause the returns of two securities to move together and the co-movement will be reflected in an industry Index. Dl. The competitive relationship between two securities may cause them to move with or against each other outside of their individual relationships with the market index IV. None of the above