Question 14 1 Jared Fuller, a money manager, uses CAPM to help identify mispriced securities. Laura Babin suggests Jared use APT instead. In comparing CAPM and APT, Laura made the following statements: 1. Both the CAPM and APT require a mean variance efficient market portfolio. 2. Neither the CAPM nor APT assumes normally distributed security returns. 3. The CAPM assumes that one Plot Area ctor explains security returns but APT does not. Which of the following answers is correct? OloD All statements are correct Statements 1 & 2 are correct and statement 3 is false Statements 1 & 3 are correct and statement 2 is false Only statement 3 is correct