If Individual Country's Capital Markets Are Segmented, the Global Capital

question 78

True/False

If individual country's capital markets are segmented, the global capital asset pricing model must not be adjusted to reflect the tendency of investors in individual countries to hold local country rather than globally diversified equity portfolios.

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Definitions:

Investment

Committing financial assets with the objective of receiving income or profit in return.

GIC

A Guaranteed Investment Certificate (GIC) is a Canadian investment that offers a guaranteed rate of return over a fixed period.

Monthly Interest

Monthly interest is the amount of interest earned or paid on an investment or loan calculated and paid on a monthly basis.

Regular-interest

The standard or typical interest rate applied to savings or investment accounts, calculated over a set period.