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In the Arbitrage Pricing Theory (APT), which of the following statement is/are correct? I. Investors are mean-variance optimizers II. There is an equilibrium mean-beta relationship

In the Arbitrage Pricing Theory (APT), which of the following statement is/are correct?

I. Investors are mean-variance optimizers

II. There is an equilibrium mean-beta relationship valid for all securities

III. The market is arbitrage-free

IV. The alpha has to be zero for well-diversified portfolios by no-arbitrage arguments

		I, II and III
		I, II, III and IV
		II, III and IV
		III and IV

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