Which one of the following is not a significant difference between the APT and the CAPM model?
A) APT is a much less restrictive asset pricing model
B) CAPM is an equilibrium model while the APT is not
C) The APT has weaker assumptions about investor preferences
D) APT assumes returns are generated by a factor model while the CAPM makes no reference to the underlying return generating process
Correct Answer:
Verified
Q28: To solve an arbitrage portfolio with five
Q29: Consider the multi-factor APT model with two-factors.
Q30: Which one of the following is NOT
Q31: Consider the one-factor APT model where the
Q32: Which one of the following statements is
Q34: An analyst develops her APT asset pricing
Q35: A pure factor portfolio is one which
Q36: 39. Your present
Q37: Consider a one-factor APT model where the
Q38: Some common characteristics of the relevant factors
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents