Analyze the Capital Asset Pricing Model (CAPM). Using the course text and an article from ProQuest as references, address the following:
- Explain how the CAPM assists in measuring both risk and return.
- Explain how the CAPM assists in calculating the weighted average costs of capital (WACC) and its components.
- Illustrate why some managers have difficulty applying the Capital Asset Pricing Model (CAPM) in financial decision making.
- Identify the benefits and drawbacks of using the CAPM.
Develop a 200 – 300 word answer supporting your position.