Question

In the capital asset pricing model (CAPM), a security market line (SML):
A. shows the effect of portfolio diversification on market risk.
B. represents the weighted average of the expected returns of all the investments composing that portfolio.
C. provides a benchmark for evaluating the relative merits of different stocks or portfolios.
D. indicates the degree to which two stock returns move together in a portfol

which one is correct ?

very very urgent​

Answer 1

Answer:

C) PROVIDES A BENCHMARK FOR EVALUATING THE RELATIVE MERITS OF DIFFERENT STOCKS OR PORTFOLIOS.

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