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Basic Question 8 of 11

If there is only one factor (market risk) in an APT mode, APT then equals ______.

A. CAPM
B. SML
C. CML

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I am happy to say that I passed! Your study notes certainly helped prepare me for what was the most difficult exam I had ever taken.
Andrea Schildbach

Andrea Schildbach

Learning Outcome Statements

describe arbitrage pricing theory (APT), including its underlying assumptions and its relation to multifactor models;

define arbitrage opportunity and determine whether an arbitrage opportunity exists;

calculate the expected return on an asset given an asset's factor sensitivities and the factor risk premiums;

CFA® 2025 Level II Curriculum, Volume 5, Module 40.