Description of this paper

If the simple CAPM is valid and all portfolios are priced correctly,

Description

solution


Question

If the simple CAPM is valid and all portfolios are priced correctly, which of the situations below is possible? Consider each situation independently, and assume the risk-free rate is 5%.;A);Portfolio Expected;Return Beta;A 18 % 0.9;Market 18 % 1.0;B);Portfolio Expected;Return Standard;Deviation;A 21 % 9 %;Market 16 % 17 %;C);Portfolio Expected;Return Beta;A 21 % 0.9;Market 16 % 1.0;D);Portfolio Expected;Return Beta;A 27.1 % 1.7;Market 18 % 1.0;Option A;Option B;Option C;Option D;Additional Requirements;Level of Detail: Show all work

 

Paper#23368 | Written in 18-Jul-2015

Price : $27
SiteLock