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APT replaced CAPM as the main asset pricing model because: a. Its assumptions are more realistic. b. APT is a generalised version of CAPM. c.

APT replaced CAPM as the main asset pricing model because:

a. Its assumptions are more realistic.

b. APT is a generalised version of CAPM.

c. It is easier to identify the factors driving asset returns with APT than with CAPM.

d. CAPMs validity as a theoretical model was questioned by research evidence.

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