According to the capital asset pricing model, the expected return on a security will be affected by all of the following except the:
A)market risk premium.
B)risk-free rate.
C)market rate of return.
D)security's standard deviation.
E)security's beta.

Question

Quizplus · Accepted Answer

The capital asset pricing model (CAPM) states that the expected return on a security is determined by the risk-free rate, the security's beta, and the market risk premium. The security's standard deviation is not directly used in the CAPM formula.

According to the Capital Asset Pricing Model, the Expected Return