Portfolio Management

Chapter 9 ASSET PRICING MODELS Multiple Choice Questions bully mart Theory 1. The Capital Asset Pricing clay sculpture: a. has serious flaws because of its complexity. b. measures germane(predicate) fortune of a security and shows the relationship betwixt risk and expected return. c. was developed by Markowitz in the 1930s. d. discounts just about only of the Markowitz portfolio theory. (b, moderate) 2.Which of the quest is not one of the assumptions of the CMT? a. All investors discombobulate the alike(p) one-period time horizon. b. in that location are no in-person income taxes. c. in that respect is no interest rate aerated on borrowing. d. There are no transaction costs. (c, moderate) 3.Which of the next is an assumption of the CMT? a. sensation investors can affect the market by their buying and merchandising decisions. b. There is no inflation. c. Investors prefer jacket crown gains over dividends. d. polar investors have different probability distributions.. (b, moderate) 4.Which of the following regarding investors and the CMT is true? a.

Investors fuck that every last(predicate) the assumptions of the CMT are unrealistic. b. Investors pull in that all of the CMT assumptions are not unrealistic. c. Investors are not aware of the assumptions of the CMT model. d. Investors recognize the CMT is useless for psyche in! vestors. (b, moderate) 5.The _______ is typically taken to be the safe rate. a. savings account b. documentation of deposit c. Treasury acme d. Treasury bond (c, easy) 6.What does it mean when the CAPM is called robust? a. The CAPM requires no assumptions. b. veritable(a) if most of the assumptions of the CAPM are relaxed, most of the...If you want to get a full essay, order it on our website: OrderEssay.net

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