Question: QUESTION ONE [10] 1.1. Define the Capital Asset Pricing Model (CAPM) (2) 1.2. Calculate the expected return of an asset with the following details: (4)

QUESTION ONE [10] 1.1. Define the Capital Asset Pricing Model (CAPM) (2) 1.2. Calculate the expected return of an asset with the following details: (4) RM = 13% RF = 5% B = 1.62 1.3. Outline and explain the major limitation (s) of the CAPM over the Arbitrage Pricing Model (APT) (4)

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