1. What statistical measure do we initially use for the relevant or non-diversifiable risk?
2. What do we call the final form of the model that emerges from using the above-mentioned measure of risk? What do we call the straight line that describes that model in a graph?
3. How does the parameter Beta come about from the above model to render the CAPM in its final form?
4. What are the differences among the Market return, the Market risk premium, the Market risk price, and the return on an individual asset or a portfolio of assets versus the assets or portfolios risk premium?
5. If two assets are in CAPM equilibrium, how can we calculate the assets risk premium without knowing the expected return on the market or the risk-free rate?