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. O There are no transaction costs. Investors assume that their investment activities won't affect the price of a stock. Investors can borrow an unlimited amount at a risk-free rate. Taxes are accounted for. Consider the equation for the Capital Asset Pricing Model (CAPM): t'i = RF + M -RF) X Covri, rm) ody In this equation, the term m - PRF) represents the expected rate of return on Stock i expected rate of return on Stock i lete the followin Suppose that the market's average excess return on expected returns to stocks for each beta coefficient average return additional return offered by a stock to induce investment