The Expected Return-Beta Relationship

question 32

Multiple Choice

The expected return-beta relationship

• A) is the most familiar expression of the CAPM to practitioners.
• B) refers to the way in which the covariance between the returns on a stock and returns on the market measures the contribution of the stock to the variance of the market portfolio,which is beta.
• C) assumes that investors hold well-diversified portfolios
• D) all of these are true.
• E) none of these are true.