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:

Vary

To change or alter in form, appearance, or nature, often with the implication of slight differences.

Federal Minimum Wage Requirements

The lowest legal hourly wage that employers can pay their workers as mandated by federal law.

Congress

The legislative branch of the United States federal government, composed of the House of Representatives and the Senate.

Inflation

The rate at which the general level of prices for goods and services is rising, eroding purchasing power.