In Contrast to the CAPM,the APT Assumes That There Can

question 76

Multiple Choice

In contrast to the CAPM,the APT assumes that there can be several sources of ________ that cannot be eliminated through diversification.

• A)nonsystematic risk
• B)systematic risk
• C)credit risk
• D)arbitrary risk

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Definitions:

Hydrolysis

A process where water splits the bonds within a specific substance through a chemical reaction.

Solubility

The ability of a substance (solute) to dissolve into another substance (solvent), forming a solution at a specific temperature and pressure.

Dissolve

To form a solution by mixing evenly with a liquid, causing a solid to become incorporated into the liquid so it becomes homogeneous.

Precipitate

A solid substance that forms in a solution through a chemical reaction and settles out of the solution.