Which of the Following Is Incorrect Regarding the Capital Asset

question 56

Multiple Choice

Which of the following is incorrect regarding the capital asset pricing model (CAPM) ?

• A) It is sometimes used to estimate the required rate of return for any firm with publicly traded stock.
• B) It is based on the premise that the only important risk of a firm is systematic risk.
• C) It is concerned with unsystematic risk.
• D) All of the above are true.

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Definitions:

Prize Drawing

A random selection process where winners are selected to receive prizes or rewards.

Legal Value

Legal Value refers to the concept in contract law that concerns the requirement of consideration to ensure that promises within a contract are enforceable.

Marketing Purposes

The use of strategies and tactics to identify, create, and maintain satisfying relationships with customers that result in value for both the customer and the marketer.

Good Faith Dispute

A disagreement where both parties have legitimate reasons for their position, implying neither is acting deceptively or maliciously.