Does the market adjust for risknbsp hownbsp is the

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Does the market adjust for risk?  How?  Is the adjustment timely enough?Some people say the P/E ratio may not be a reliable indicator of a stock’s expected future performance.  Why is that?Is the stock valuation model a useful tool?  Why or why not?

What is the Capital Asset Pricing Model?  How can it be used to calculate a businesses required return?  Is it useful or too theoretical?

Reference no: EM13395777

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