Both the APT and the CAPM Imply a Positive Relationship

question 5

Multiple Choice

Both the APT and the CAPM imply a positive relationship between expected return and risk.The APT views risk:

• A)very similarly to the CAPM via the beta of the security.
• B)in terms of individual intersecurity correlation versus the beta of the CAPM.
• C)via the industry wide or marketwide factors creating correlation between securities.
• D)as the standardized deviation of the covariance.
• E)None of the above.

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Definitions:

American Indians

Indigenous peoples of the Americas, including various tribes and nations, with distinct cultures and histories.

War Veterans

Individuals who have served in the armed forces, especially those who have served in combat, and may face unique health and social challenges as a result of their military service.

Risk Of Suicide

The likelihood or propensity of an individual to engage in behaviors that could lead to their own death, often assessed in those with mental health conditions.

Nonveterans

Individuals who have not served in the military.