Question: True or False? If False, explain (a) In CAPM, expected returns compensate investors for systematic risk and idiosyncratic risk. (b) The probabilities of a boom

True or False? If False, explain (a) In CAPM, expected returns compensate investors for systematic risk and idiosyncratic risk. (b) The probabilities of a boom and a bust scenario are 20% and 20% respectively. Returns on Stock C in a boom and a bust are 30% and -30%. Therefore, the expected return on Stock C is 0%

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