Which of the following assumptions is common between the pricing models of CAPM and APT?

Question

TuteeHUB · Accepted Answer

NA

TuteeHUB · Answer

A single period investment horizon

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The investors can freely borrow and lend at risk-free rate

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The investors select portfolios based on expected mean and variance of return

TuteeHUB · Answer

Investors have homogeneous expectations and are expected-utility-of-wealth maximizers.

1.	Which of the following assumptions is common between the pricing models of CAPM and APT?
A.	A single period investment horizon
B.	The investors can freely borrow and lend at risk-free rate
C.	The investors select portfolios based on expected mean and variance of return
D.	Investors have homogeneous expectations and are expected-utility-of-wealth maximizers.
Answer» E.

Discussion