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Explain the CAPM model. [HINT: we need to DISCUSS systematic and unsystematic risks, liversification, how CAPM was designed, assumptions CAPM makes, SML line, the model

Explain the CAPM model. [HINT: we need to DISCUSS systematic and unsystematic risks, liversification, how CAPM was designed, assumptions CAPM makes, SML line, the model and he variables in the model, things CAPM can't explain, etc.]. (15 points)

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