1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Andru [333]
3 years ago
14

Which of the following statements about the capital asset pricing model (CAPM), which is the "father" of the security market lin

e (SML), is (are) most correct?a. The CAPM is based on a restrictive set of assumptions.b. It has not been empirically verified. In general, its inputs are difficult to estimate, particularly E(g).c. Despite its deficiencies, it provides investors with a rational way of thinking about required rates of return.d. All of the above responses are correct.
Business
1 answer:
HACTEHA [7]3 years ago
7 0

Answer:

(d) All of the above responses are correct

Explanation:

The Capital asset pricing model (CAPM) helps in calculation of expected rate of return by an investor which is dependent upon risk premium and beta.

Beta refers to sensitivity of return from stock with respect to the market return.

Risk premium refers to the additional rate of return which an investor must be provided so as to compensate him for additional risk he assumes.

ER = Rf + β (Rm- Rf)

ER= Expected Rate Of Return

Rf= Risk Free Rate of Return

Rm= Return from market

β = sensitivity index of security return to market return

Security Market Line (SML) is a graphic representation of CAPM.

Thus,  (d) is the correct option

You might be interested in
Labor and management at Leo Trucking cannot seem to agree upon a contract for the truck drivers. As each side contends that they
Fynjy0 [20]

Answer:

resistance points

Explanation:

In simple words, The resistance level can be understood as the lowest point where a mediated settlement will be accepted. For a vendor, this implies the smallest number (minimum) or end result they are willing to take, whereas for a purchaser, it implies the highest number (upper limit) or bottom boundary they are willing to spend.

Thus, from the above we can conclude that the correct answer is resistance point.

5 0
2 years ago
Ann is in the middle of completing her first 1040EZ tax form. She has some questions about an instruction on the form. What shou
Len [333]
Look at the instructions for that form 1040EZ online. If that doesn't help you call the dept of taxation for help
7 0
3 years ago
Harry and Meghan have considered starting their own business but are concerned about the possibility of losing even their person
schepotkina [342]

Answer:

The correct option is D,form a corporation

Explanation:

The rationale for my choice of answer is that limited liability applies to a corporation which is found in other types of businesses.

Limited liability is a concept which implies that the liability of shareholders in a limited liability company is limited to the amount contributed to the business by a way of shares held in the company.

When a company runs into debt,the shareholders would not be required to make up such debts from their private pockets,hence Harry and Meghan personal effects are secure.

4 0
3 years ago
If a production process creates positive​ externalities, a competitive market produces too few positive externalities because th
IceJOKER [234]

Answer:

The correct answer is option B.

Explanation:

When there is a positive externality the social benefit to consumers will be higher than the private benefit. Positive externalities mean that the benefit of production will be earned by some third party. The firms will not be compensated for these externalities. This will lead to market failure. So, a competitive firm will produce too few positive externalities unless the firms are compensated.  

4 0
3 years ago
A manufacturing company that has only one product has established the following standards for its variable manufacturing overhea
Butoxors [25]

Answer:

b. $1,144 unfavourable.

Explanation:

The computation of the  variable overhead efficiency variance is shown below:

= (Actual Hours - Standard Hours) × Standard rate per hour

=(1,700  - 8.1 × 200 units) × $14.30

= 80 × $14.30

= $1,144 unfavorable

hence, the variable overhead efficiency variance is $1,144 unfavorable

Therefore the option b is correct

6 0
3 years ago
Other questions:
  • Carly is eager to tell the interviewer about the team she led of product managers from the United States, Latin America, and Eur
    12·2 answers
  • Bonita Industries had the following information at December 31: Finished goods inventory, January 1 $120000 Finished goods inven
    12·1 answer
  • In the discussion of German and Japanese postwar growth, the text describes what happens when part of the capital stock is destr
    8·1 answer
  • GIVING AWAY BRAINLIST
    6·2 answers
  • How did the US find out about the missiles being set up in Cuba?
    12·1 answer
  • Consider a process consisting of three resources. Assume there exists unlimited demand for the product, and that all activities
    14·1 answer
  • Michael is the project manager in a manufacturing company. He wants his organization to use technology for higher revenue and pr
    8·2 answers
  • Information of Company X:
    15·1 answer
  • With regards to a firms product line, a cost leadership strategy would strive for _______ while a differentiation strategy would
    6·1 answer
  • What is meant by 'Price elastic demand?​
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!