The Capital Asset Pricing Model (CAPM)

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The 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

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