In the context of the Capital Asset Pricing Model (CAPM)the relevant measure of risk is
A) unique risk.
B) beta.
C) standard deviation of returns.
D) variance of returns.
E) none of these.

Question

Quizplus · Accepted Answer

The relevant measure of risk in CAPM is beta, as it measures the systematic risk of an asset in relation to the overall market. Unique risk (A) is not considered in the model, while standard deviation (C) and variance (D) are measures of total risk that include both systematic and unsystematic risk.

In the Context of the Capital Asset Pricing Model (CAPM)the