The expected rate of return on an asset is given by j 7%, while for the market portfolio, M = 5%. The asset's standard deviation of return is o 0.2, while for the market portfolio M = 0.1. The correlation between the asset's return and the market return is: PjM = 0.75. The risk-free interest rate is ro = 1%. - A. The given information is incompatible with the Capital Asset Pricing Model (CAPM) prediction. B. The Sharpe ratio for the market portfolio M equals 0.50. C. The Sharpe ratio for asset j equals 0.60. D. Asset j's beta-coefficient equals 1.5. E. None of the above.

The expected rate of return on an asset is given by j=7%, while for the market portfolio, M=5%. The asset's standard deviation of return is j= 0.2 , while for the market portfolio M=0.1. The correlation between the asset's return and the market return is: jM=0.75. The risk-free interest rate is r0=1%. A. The given information is incompatible with the Capital Asset Pricing Model (CAPM) prediction. B. The Sharpe ratio for the market portfolio M equals 0.50 . C. The Sharpe ratio for asset j equals 0.60 . D. Asset j 's beta-coefficient equals 1.5 . E. None of the above