According to the Capital Asset Pricing Model (CAPM), fairly-priced securities have o zero alphas. o positive...

Question

Question

Answer 1

Answer #1

The answer is Zero alphas

Alpha is the difference between actual return and CAPM return

Fairly priced Securities return is same as CAPM Return

Beta can be positive, negative or Zero

8.Risk free rate = Expected return – risk premium

= 7%-2%

= 5%

Answer 2

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