Both the APT and the CAPM Imply a Positive Relationship

question 22

Multiple Choice

Both the APT and the CAPM imply a positive relationship between expected return and risk.The APT views risk:

• A)very similarly to the CAPM via the beta of the security.
• B)in terms of individual intersecurity correlation versus the beta of the CAPM.
• C)via the industry wide or marketwide factors creating correlation between securities.
• D)the standardized deviation of the covariance.
• E)None of the above.

---

Definitions:

Sexual Dysfunctions

Conditions that impair an individual's ability to participate in or experience sexual activity to their satisfaction.

Provisional

Temporary or conditional, often used in contexts where a final version or decision has yet to be made or confirmed.

Substance-related Disorders

Mental health disorders related to the excessive use and dependence on harmful substances, such as drugs or alcohol, leading to significant personal and social consequences.

Addictive Disorders

Mental health conditions characterized by an uncontrollable urge to engage in harmful substances or behaviors despite adverse consequences.