Which of the Following Statements Is/are True

question 24

Multiple Choice

Which of the following statements is/are true?

• A)Both APT and CAPM argue that expected excess return must be proportional to the beta(s).
• B)APT and CAPM are the only approaches to measure expected returns in risky assets.
• C)Both CAPM and APT are risk-based models.
• D)Both A and B.
• E)Both A and C.

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Definitions:

Manufacturing Operations

Processes involved in the conversion of raw materials or components into finished goods that meet a company's quality standards and customer expectations.

Operating Segments

Components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance.

Reportable

Pertains to the requirement to disclose or make known certain information to regulatory bodies or in financial statements.

Revenue Test

An accounting principle used to determine when revenue is recognizable in the financial statements based on specified criteria.