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Question 14 If the simple CAPM is valid and all portfolios are priced correctly, which of the situations below is possible? Consider each situation independently, and assume the risk-free rate is 2.5%. A) Portfolio Expected Return Beta 17.5% 1.5 Market 12.5% 1.0 B) Portfolio Expected Return Standard Deviation A 8.5% 18.0% Market 10.0% 24.0% C) Portfolio Expected Return Beta 13.5% 1.2 Market 10.0% 1.0 D) Portfolio Expected Return Beta A 7.5% 0.6 Market 10.0% 1.0 Option D Option A Option C O Option B

Question 14 If the simple CAPM is valid and all portfolios are priced correctly, which of the situations below is possible? Consider each situation independently, and assume the risk-free rate is 2.5%. A) Portfolio Expected Return Beta 17.5% 1.5 Market 12.5% 1.0 B) Portfolio Expected Return Standard Deviation A 8.5% 18.0% Market 10.0% 24.0% C) Portfolio Expected Return Beta 13.5% 1.2 Market 10.0% 1.0 D) Portfolio Expected Return Beta A 7.5% 0.6 Market 10.0% 1.0 Option D Option A Option C O Option B

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Question 14 If the simple CAPM is valid and all portfolios are priced correctly, which of the situations below is possible? Consider each situation independently. and assume the rísk-free rate is 2.5%. A) Portfolio Expected Return Beta A 17.5% 1.5 Market 12.5% 1.0 B) Portfolio Expected Return Standard Deviation A 8.5% 18.0% Market 10.0% 24.0% Portfolio Expected Return 13.5% 10.0% Beta A 1.2 Market 1.0 D) Portfolio Expected Return Beta A 7.5% 0.6 Market 10.0% 1.0 Option D Option A Option C Option B
Transcribed Image Text:Question 14 If the simple CAPM is valid and all portfolios are priced correctly, which of the situations below is possible? Consider each situation independently. and assume the rísk-free rate is 2.5%. A) Portfolio Expected Return Beta A 17.5% 1.5 Market 12.5% 1.0 B) Portfolio Expected Return Standard Deviation A 8.5% 18.0% Market 10.0% 24.0% Portfolio Expected Return 13.5% 10.0% Beta A 1.2 Market 1.0 D) Portfolio Expected Return Beta A 7.5% 0.6 Market 10.0% 1.0 Option D Option A Option C Option B
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