Which One of the Following Is Not a Significant Difference

question 30

Multiple Choice

Which one of the following is not a significant difference between the APT and the CAPM model?

• A) APT is a much less restrictive asset pricing model
• B) CAPM is an equilibrium model while the APT is not
• C) The APT has weaker assumptions about investor preferences
• D) APT assumes returns are generated by a factor model while the CAPM makes no reference to the underlying return generating process

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