The Most Significant Conceptual Difference Between the Arbitrage Pricing Theory

question 31

Multiple Choice

The most significant conceptual difference between the arbitrage pricing theory (APT) and the capital asset pricing model (CAPM) is that the CAPM ________.

• A) places less emphasis on market risk
• B) recognizes multiple unsystematic risk factors
• C) recognizes only one systematic risk factor
• D) recognizes multiple systematic risk factors

---

Definitions:

Tourette Syndrome

A brain disorder marked by uncontrollable, spontaneous movements and sounds known as tics.

Parkinson Disease

A progressive neurological disorder characterized by motor symptoms such as tremors, rigidity, and bradykinesia, as well as non-motor symptoms.

Excitation And Inhibition

Fundamental processes in the nervous system that activate or suppress the activity of neurons, shaping neural responses and behaviors.

Microbiome

A community of microorganisms, such as bacteria, viruses, fungi, and their genetic material, that lives in a particular environment, especially within the human body.