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12. The most significant conceptual difference between the arbitrage pricing theory (i.e. APT or factor model) and the capital asset pricing model (CAPM) is that

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12. The most significant conceptual difference between the arbitrage pricing theory (i.e. APT or factor model) and the capital asset pricing model (CAPM) is that APT A. does not consider stock sensitive to the market risk B. suggests that all stock returns are perfectly predictable if you know Beta coefficient C. ignores residuals in a multi-factor form of the model D. recognizes that there can be firm specific risk factors

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