An Important Difference Between CAPM and APT Is

question 79

Multiple Choice

An important difference between CAPM and APT is

• A)CAPM depends on risk-return dominance; APT depends on a no arbitrage condition.
• B)CAPM assumes many small changes are required to bring the market back to equilibrium; APT assumes a few large changes are required to bring the market back to equilibrium.
• C)implications for prices derived from CAPM arguments are stronger than prices derived from APT arguments.
• D)all of the above are true.
• E)both A and B are true.

Comprehend the importance of preparing and structuring information before delivering bad news in person.

Apply the principles of tact and diplomacy in constructing bad-news messages within organizations.

Understand the use of passive-voice verbs to soften the impact of bad news.

Learn the elements to include in the closure of bad-news messages to maintain a positive tone.

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Definitions:

Available-for-Sale Securities

Financial assets that are held for sale in the short term and which can be converted into cash, generally classified as current assets.

Fair Values

The estimated market value of an asset or liability, based on current market prices.

Unrealized Holding

Refers to the increase or decrease in the value of investments held by the company that have not been sold.

Securities Held

Financial instruments that are owned and held by an investor, including stocks, bonds, or other investments.