In the Capital Asset Pricing Model, a stock's expected rate of return will depend on its total risk.

Name: In the Capital Asset Pricing Model, a stock's expected rate of return will depend on its total risk.
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In the Capital Asset Pricing Model (CAPM), a stock's expected rate of return depends on its systematic risk (beta), not its total risk. Total risk includes both systematic (market) risk and unsystematic (specific) risk, but CAPM considers only the systematic risk.

In the Capital Asset Pricing Model, a Stock's Expected Rate