Do you agree with three assumptions made in CAPM? Please take a closer look at those three, and think about the outcomes when one of those assumptions are changed or modified. Could you describe it to us how the required return of each assets will be different, as well as portfolio efficiency, CML and SML?

This problem leads you to try to change one of the assumptions established in CAPM, and its application to the optimal portfolio theory. Given those assumptions, we can have a clear picture of how market demand and supply interact, and the equilibrium level has been formed. However, what if those assumptions are changed? What happens if investors have different expectations? What if the market is not competitive? You can imagine a plenty of variations from the benchmark cases, and all the academic papers have been developed up to now starting with these modifications.