About the capital asset pricing model

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Reference no: EM131044656

Which of the following statements about the capital asset pricing model (CAPM), which is the "father" of the security market line (SML), is(are) most correct?

The CAPM is based on a restrictive set of assumptions.

It has not been empirically verified.

In general, its inputs are difficult to estimate, particularly E(g).

Despite its deficiencies, it provides investors with a rational way of thinking about required rates of return.

All of the above responses are correct.

Reference no: EM131044656

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