About the active management

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Reference no: EM132069577

1. Active management:

a. can outperform a passive strategy if markets are semi-strong form efficient b. can outperform a passive strategy if markets are strong-work efficient. c. cannot outperform a passive strategy if markets are semi-strong form efficient d. cannot outperform a passive strategy if markets are weak form efficient

2. According to the capital asset pricing model,

a. Beta is the slope of security market line b. a stock with high risk, measured as standard deviation of returns, will have high expected returns in equilibrium c. all the investor who take on risk will hold the same risky-asset portfolio d. an investor who is risk averse should hold at least some of the risk-free asset in his portfolio

Reference no: EM132069577

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