The Capital Asset Pricing Model

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The Capital Asset Pricing Model

IBM is a multinational company that deals in computer technology and information technology consultancy. It is an American based organisation that is currently facing tough competition from other IT companies in this sector. The Capital Asset Pricing Model is a measurement of return on assets invested in the company. The model also takes into consideration two types of risk one is the systematic risk and the other is the diversifiable risk. The non-diversifiable, systematic or market risk is represented by the beta quantity of the industry in which the company ...