Discuss Whether the Following Statement Is True or False

question 8

True/False

Discuss whether the following statement is true or false:
Under the assumption of a CAPM with no riskless lending or borrowing,every investor holds the same portfolio of risky assets.

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Definitions:

ROE

Return On Equity; a measure of a corporation's profitability that reveals how much profit a company generates with the money shareholders have invested.

Operating ROA

A financial ratio that measures the efficiency of a company's operation by dividing its operating income by its total assets.

Net Profit

The amount of income that remains after all expenses, taxes, and costs have been subtracted from total revenue; a key indicator of a company's profitability.

EBIT

Earnings Before Interest and Taxes, a measure of a firm's profit that includes all expenses except interest and income tax expenses.