1. The Law of One Price states that
   1. All assets must trade at the price suggested by the CAPM
   2. Prices only change in response to new information
   3. Two economically identical assets cannot trade at different prices for very long
   4. All rational investors must hold the market portfolio
2. Which of the following assets would you expect to be the most liquid?
   1. Money market securities
   2. Long term debt
   3. Equity
   4. Preferred shares