the CAPM allows us to identify the efficient portfolio of risky assets without having any knowledge of the ________ of each security.
A) systematic risk
B) common risk
C) diversifiable risk
D) expected return

Question

Quizplus · Accepted Answer

The Capital Asset Pricing Model (CAPM) allows for the identification of the efficient portfolio of risky assets without requiring knowledge of the expected return of each security. It does so by focusing on the relationship between an asset's risk relative to the market (systematic risk) and its expected return, rather than the individual expected returns of securities.

The CAPM Allows Us to Identify the Efficient Portfolio of Risky