Solved

Which of the Following Is True About the Security Market

Question 34

Multiple Choice

Which of the following is true about the security market line (SML) derived from the APT?


A) The SML has a downward slope.
B) The SML for the APT shows expected return in relation to portfolio standard deviation.
C) The SML for the APT has an intercept equal to the expected return on the market portfolio.
D) The benchmark portfolio for the SML may be any well-diversified portfolio.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q4: Consider the one-factor APT. The standard deviation

Q5: Consider the single-factor APT. Stocks A and

Q14: Consider the one-factor APT. The variance of

Q30: Consider the multifactor APT.There are two independent

Q32: Advantage(s) of the APT is(are)<br>A)that the model

Q35: To take advantage of an arbitrage opportunity,

Q36: An important difference between CAPM and APT

Q37: Which pricing model provides no guidance concerning

Q39: _ a relationship between expected return and

Q42: A well-diversified portfolio is defined as<br>A) one