Reference no: EM132041917

1. The efficient market hypothesis assumes that

there are only a few buyers and sellers in a stock market and stocks are illiquid

there are many buyers and sellers in a stock market and stocks are illiquid

there are only a few buyers and sellers in a stock market and stocks are liquid

there are many buyers and sellers in a stock market and stocks are liquid

2. In the CAPM, if a stock has a large beta coefficient, then

the stock's return is less volatile than the market's average return

the stock's return is about as volatile as the market's average return

the stock's return is more volatile than the market's average return

the stock's risk is greater than its expected return