CORPORATE FINANCE
CORPORATE FINANCE
12th Edition
ISBN: 9781307702804
Author: Ross
Publisher: MCG/CREATE
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Chapter 12, Problem 2CQ
Summary Introduction

To determine: To respond to the statement.

Introduction:

Arbitrage Pricing Theory (APT) is a substitute form of CAPM (Capital Asset Pricing Model). This hypothesis, as CAPM gives financial specialists or investors assessed required rate of return for the risky securities. APT reflects on risk premium premise indicated set of elements notwithstanding the correlation of the cost of the asset with expected surplus return on the portfolio.

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