The Capital Asset Pricing Model

question 27

Multiple Choice

The Capital Asset Pricing Model:

• A)has serious flaws because of its complexity.
• B)shows the relationship between risk and expected return.
• C)was developed by Markowitz in the 1930s.
• D)is a discounted-cash-flow valuation model.

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Definitions:

Legal Assent

A mutual agreement under contract law wherein all parties involved acknowledge and adhere to the terms of a contract, making it legally binding.

Scienter

Knowledge of wrongdoing or fraudulent intent, often a necessary element in fraud cases.

Intent To Deceive

A deliberate act or condition of willfully misleading someone or concealing the truth to gain an unfair advantage.

Undue Influence

Excessive pressure or manipulation exerted by one individual over another to the extent it overcomes the victim's free will, often discussed in contexts of contracts and wills.