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Suppose that the CAPM holds. The stock of Philip Morris (PM) has a beta of 0.5. Which of the following statements is true? Group of
Suppose that the CAPM holds. The stock of Philip Morris (PM) has a beta of 0.5. Which of the following statements is true?
Group of answer choices
On average, PM's stock performs better than the market when the market's return is negative.
PM's stock always performs worse than the market.
The return of PM's stock is negatively correlated with the market portfolio's return.
The expected return of PM's stock is lower than the risk-free rate.
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