For a single factor model of returns, given by ri,t = i + iFt + i,t, which of the following assumptions do we make?

1 var(i) < 0

2 E[i,t|Ft ] = 0

3 Corr(i,t, Ft) = 0 for all i, t

4 i = 0 for all assets

A) both 2 and 3, but not 1 and 4 B) both 3 and 4, but not 1 and 2 C) only 4 D) we make all of these assumptions E) none of the above