User Account

All Pages

Explain the difference between apt and the capm

Assignment Help Finance Basics
Reference no: EM133001234

The arbitrage pricing theory (APT) and the capital asset pricing model (CAPM) have received much attention from practitioners and academicians for use in asset pricing and valuation. a. Explain the difference between APT and the CAPM with respect to: (1) investor utility functions (2) distribution of returns (3) the market portfolio b Explain one conceptual difference between the APT and the CAPM other than those listed in Part a.

Reference no: EM133001234

Questions Cloud

Size of the investment required : Bukas Palad Corporation is in wholesale business. The manager in charge is taking care of all the operations. The branch in Davao is earning a lot of revenue th
Announcements and security prices : Suppose the government announces that, based on a just-completed survey, the growth rate in the economy is likely to be 3 per cent in the coming year, as compar
What is forward rate you can lock in today : The strip yield curve today looks as follows (all yields are APRs with semi-annual compounding):
Is anything of interest in the notes to the balance sheet : Is there anything of interest in the notes to the balance sheet for either company? Find the balance sheet for each of the two companies you have selected.
Explain the difference between apt and the capm : The arbitrage pricing theory (APT) and the capital asset pricing model (CAPM) have received much attention from practitioners and academicians for use in asset
Determine the effect on the cost of goods sold : Determine the effect on the cost of goods sold, total assets, and gross margin for 2015 and 2016 if the following inventory errors are not corrected. Indicate y
How would you maintain a riskless hedge : A stock price is currently 580 and its volatility is 5%. Using a 2-step binomial tree obtain the price of a 1 year American put on the stock with a strike price
How many each of core and elective courses be scheduled : How many each of core and elective courses be scheduled so that total faculty salaries are kept to a minimum? A technical college department head must plan
What is the quarterly standard deviation of returns for ford : Ford Motor Company had realized returns of 5%, 15%, - 15%, and - 5% over four quarters. What is the quarterly standard deviation of returns for Ford?

Reviews

Write a Review

Finance Basics Questions & Answers

  Describe one type of cost that is minimized with jit control

Describe one type of cost that is minimized with JIT control. In order to use JIT, is it better to have high ordering costs or low?

  How much is basic earnings per share amount for 2011

Creekside paid $30 million in dividends on preferred stock, which was convertible into 15 million shares of common stock. How much is basic earnings per share amount for 2011?

  As the rate of innovation increases companies face

as the rate of innovation increases companies face expanding productservice lines shorter product and service

  Calculate the expected returns and betas on portfolios

Calculate the expected returns and betas on portfolios with x% invested in Stock I and the rest invested in the risk-free asset

  Estimate the value of division

Estimate Weston's current equity beta and cost of capital. Is this cost of capital useful for valuing Weston's projects? How is Weston's equity beta likely

  Compute nelson internal growth rate

Based on these projections, compute Nelson's "internal growth rate".

  Why is the optimal debt ratio for reebok so high

In 1995, an analysis of the capital structure of Reebok provided the following results on the weighted average cost of capital and firm value.

  Real risk-free rate of interest

Currently, Treasury bills are yielding 4.5% and the future inflation rate is expected to be 2.1% per year. Ignoring the cross product between the real rate of interest and the inflation rate, what is the real risk-free rate of interest?

  Closed-end leases with required down payments

A leading supplier of grapes to the wine- producing industry in California, On the Vine Grapes, wants to expand its delivery services and expand its reach to market by increasing its current fleet of delivery trucks. Some of the older vehicles..

  Responding to the change of environment

Temperature is one of the factors which can modulate the body function.

  Describe strategic and tactical decisions

Describe strategic and tactical decisions and provide a real-world example of how each type of decision would be applied in a business context.

  Difference between average and marginal tax rates

What is the difference between average and marginal tax rates?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd