Which one of the following is NOT a difference between the Arbitrage Pricing Theory (APT)and CAPM models?
A)Risk factors
B)Arbitrage principle
C)Market portfolio
D)Pricing risk

Question

Quizplus · Accepted Answer

Both the Arbitrage Pricing Theory (APT) and the Capital Asset Pricing Model (CAPM) involve pricing risk, but they approach it differently. APT uses multiple risk factors, while CAPM is based on a single market risk factor. The key differences lie in the use of risk factors, the arbitrage principle, and the reliance on a market portfolio, making D not a distinguishing factor.

Which One of the Following Is NOT a Difference Between