Based on the CAPM​ model, a stock with a negative beta has which of the following​ characteristics?   A. An expected return less than zero.   B. An expected return equal to the​ risk-free rate.   C. Since these are so​ rare, the CAPM model does not account for negative beta stocks.   D. An expected return less than the​ risk-free rate.

please answer both. If a stock's fair return increases, what will happen to the stock's value?   A. It will increase.   B. It will not change.   C. It will decrease.     If the market risk premium rises, what will happen to the stock's price?   A. It will not change.   B. It will increase.   C. It will decrease.

Answer whether each of the following statements is correct and explain your argument. \ (a) According to CAPM, the expected return of a risky asset is larger than the risk free rate. (b) According to CAPM, the expected return of a risky asset increases with its variance. (c) According to the separation property, the optimal risky portfolio for an investor dependson the investor’s personal preference. (d) A less risk-averse investor has a steeper indifference curve for the utility function.

Suppose our portfolio consists of two stocks A and B. What should be the correlation between them so that we have no risk in our portfolio?

Explain what is meant by beta. What risk does beta measure? What is the market return? How is the interpretation of beta related to the market return?

According to the CAPM, a stock's expected return is positively related to its beta. True or False True False

Which of the following(s) would be ways to reject the CAPM?   a   showing that there exist a stock with zero beta with the market earns an expected return higher than the risk free rate b   showing that there exist a stock that earns higher expected return than the market c   Showing that a portfolio consistently generates a negative alpha d   Showing that a certain factor predicts expected return even after controlling for market beta

Which one of the following statements is correct? When more stocks are added into a portfolio, the beta of that portfolio will a) always decrease. The beta of ABC and XYZ is 1.95 and 0.88, respectively. This information b) implies that ABC has less market risk than XYZ. A stock has a beta of 1.5. It implies that this stock has lower total risk than c) the overall market. The beta of ABC and XYZ is 1.95 and 0.88, respectively. This information implies that ABC has higher total risk than XYZ. The risk premium investors demand from a stock will increase as the beta of the stock increases.

No matter how the stock price fluctuates, as long as it can provide a positive return, the risk of investing in stocks is low.If the concept of standard deviation is applied, is this true or false?

Which of the following statement is true? (a) Correlation has no effect on the expected return of a portfolio. (b) As the correlation between two stocks increases, the volatility of the two-stock portfolio falls. (c) The correlation of a stock's return with itself is zero. (d) None of the above