Compare the assumptions underlying Arbitrage Pricing Theory with those underlying the mean-variance Capital Asset Pricing Model. Which set of assumptions seems more realistic to you? Why?

There are three Underlying Assumptions under the Arbitrage Pricing Theory which are as below:
1. Asset returns under Arbitrage Pricing Theory are explained by the systematic factors.
2. Under Arbitrage Pricing Theory, investors can build portfolio of the assets in which
specific risk is eliminated through the diversification.
3. Also the arbitrage opportunity...