Question: The arbitrage pricing theory ( APT ) differs from the single - factor capital asset pricing model ( CAPM ) because the APT: Recognizes multiple

The arbitrage pricing theory (APT) differs from the single-factor capital asset pricing model (CAPM) because the APT:
Recognizes multiple systematic risk factors.
Minimizes the importance of diversification.
Recognizes multiple unsystematic risk factors.
Places more emphasis on market risk.

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