1. Investment risk and default risk are interchangeable terms and essentially mean the same thing.

2. Disadvantages of the Capital Asset Pricing Model include that you are using the past to predict the future and that you have to estimate beta and the market risk premium, which both vary over time.

3. An equity multiplier of 0.5, means that one-half of the book value of the venture's assets was financed by (the book value of) debt financial capital.