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Are the following statements true or false? Explain your reasoning. a. CAPM implies that investors require a higher rate of return to hold more volatile
Are the following statements true or false? Explain your reasoning.
a. CAPM implies that investors require a higher rate of return to hold more volatile (higher standard deviation) securities.
b. You can construct a portfolio with a beta of .5 by investing .5 of the investment in T-Bills and the remainder in the market portfolio.
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