The Capital Asset Pricing Model (CAPM)
SYNTHETIC SAILS IMPORTATION DUTY
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May 25, 2020The Capital Asset Pricing Model (CAPM)
1 Does CAPM-beta really provide the answer to the risk-return relationship?
¢ Define the fundamental features of the CAPM
¢ How CAPM measure systematic risk
¢ The relationship between systematic risk, measure beta and return on securities (included several relevant
diagram or graph)
2 Does CAPM provide a good account for pricing a firm’s debt or equity?
¢ Criticism of the model from the academic community
¢ Why the academic community are turned away from the CAPM( main focused on)
¢ CAPM has reached new heights of popularity in the outside world, why it is popular?
3 Is CAPM of relevance to corporate managers?
¢ Highlight the features of the CAPM which lends itself to the context of corporate managers
¢ How CAPM benefit for corporate managers
