Identify the one true statement about capital asset pricing

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Problem 1: Identify the one true statement about capital asset pricing:

(a) International CAPM model is used to derive the riskiness of the actual cost of capital

(b) In the international CAPM, there is a political risk factor which explains asset returns

(c) International financial markets in the model are assumed to be isolated

(d) Forward exchange rates are used to calculate the foreign currency risk premium

(e) None of the above

Reference no: EM132915613

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