3. The basics of the Capital Asset Pricing Model Which of the following are assumptions of the Capital Asset Pricing Model (CAPM)? Check all that apply. Assets won't be short sold. Asset quantities are given and fixed. Investors have homogeneous expectations. Asset quantities aren't given. Consider the equation for the Capital Asset Pricing Model (CAPM): Cov(r.FM) 7TRF + (M-TRF) X In this equation, the term 7, represents the expected rate of return on Stock i In this equation, the term ?, represents the expected rate of return on Stock i Suppose that the market's average excess return on stocks is 10.00% and that the risk-free rate is 1.00%. Complete the following table by computing expected returns to stocks for each beta coefficient using the Capital Asset Pricing Model (CAPM): b Expected Return to Stocks (%) -0.70 0.20 1.00 2.00 Based on the CAPM and your calculations for the return to stocks, what does it mean when the coefficient b,