1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
kvasek [131]
3 years ago
8

The Security Market Line (SML) shows the relationship between stocks' required rates of return (measured on the vertical axis) a

nd their betas (measured on the horizontal axis). The vertical axis intercept is the required rate of return on a riskless asset, and the required rate of return associated with b = 1.0 is the required rate of return on "the market." The difference between the required rate of return on the market and that on the riskless asset (rM – rRF) is defined as the "market risk premium." The steeper the SML, the larger the market risk premium, and the greater the average investor's aversion to risk. True or false?
Business
1 answer:
natka813 [3]3 years ago
5 0

Answer:

True

Explanation:

The reason is that the straight line equation is used to illustrate the relation between the rate of return and the beta factor and is given as under:

Y = a + bX

Here

a = Rf

B = Risk premium = Rm - Rf

X = Beta Factor

So this means the security market line is the graphical presentation of capital asset pricing model and illustrates why the increase in beta factor increases the required rate of return, the reason is that the the overall required return Y of the investment will start increasing with the increase in the beta factor.

So the statement is true.

You might be interested in
Which of the following is true of both paying with a check and paying with a debit card? A. Both work like a loan from your bank
Sedaia [141]
<span> B. When used, both take money directly out of a bank account.</span>
7 0
3 years ago
Which management viewpoint places emphasis on the importance of understanding human beings and the motivation and encouragement
Basile [38]
<h2>Behavioral view point is pertaining to the motivation and encouragement of employees towards achievements.</h2>

Explanation:

Initially the organization was  

  • concentrating only on the productivity of the employee
  • lost focus on motivating employees
  • not providing much "employee-friendly" atmosphere

Later on, the "Behavioral management" theory helped the organization

  • a shift from Production to leadership based work culture
  • a good work environment to satisfy the employees
  • Motivate to achieve good results
  • Reach both individual and organization's goal
  • Motivating by providing Increase in the wages
7 0
3 years ago
g The Federal Reserve can lower short-run output by Group of answer choices lowering the real interest rate. increasing the mone
Viktor [21]

Answer: Decreasing the money supply

Explanation:

When the Fed reduces money supply, it will remove the amount of excess money that people have to spend in the economy. This will lead to prices reducing because people no longer have a lot of money to spend on products therefore they will demand less goods. This will lead to the Aggregate demand curve shifting to the left. The new intersection with the Aggregate Supply curve will be at a point where prices will be lower and less quantity will be demanded which will signify a drop in the short-run output of the economy.

5 0
3 years ago
Reasons for the high cost of many application packages​
sdas [7]

Answer:

Poorly designed materials storage and packaging lines. Long packaging process times. Paying for box dimensions rather than product dimensions. Ineffective packaging materials that allow damage. Inefficient manufacturing models. Failing to optimize packaging.

4 0
3 years ago
Read 2 more answers
An airport wants to make its luggage-handling process faster and simpler for travelers. A data analyst examines and evaluates ho
Anastasy [175]

To make the baggage handling process faster and simpler for travelers, a data analyst uses a gap analysis.

<h3 /><h3>What is a  gap analysis?</h3>

Corresponds to a performance evaluation technique, where a professional is responsible for evaluating the way processes are being carried out in an organization, to determine their efficiency, developing an analysis of needs to increase quality.

Therefore, a gap analysis aims at the continuous improvement of processes through environmental assessment, in order to achieve total quality.

Find out more about gap analysis here:

brainly.com/question/10549036

#SPJ1

4 0
2 years ago
Other questions:
  • Bob is a manager at a local toyota dealership who has lost five of his employees last year. now he has to make a decision about
    8·1 answer
  • Caroline Perfumes is a premium, exotic women's fragrance company. The manufacturers of Caroline Perfumes
    10·1 answer
  • Ryan Olson organized a new company, MeToo, Inc. The company provides networking management services on social network sites. You
    8·1 answer
  • During the first month of operations ended July 31, YoSan Inc. manufactured 2,400 flat panel televisions, of which 2,000 were so
    12·1 answer
  • Jorge purchased a copyright for use in his business in the current year. The purchase occurred on July 15th and the purchase pri
    9·1 answer
  • A container of bolts, currently located in Houston, TX, needs to be delivered to a facility in Sioux Falls, SD. The standard gro
    15·1 answer
  • Gordon would like to win back his customer by giving him tickets to a major league baseball game, but he knows his company frown
    6·1 answer
  • Calculate the selling price per unit charged by the outside supplier that would make ABC Company economically indifferent betwee
    12·1 answer
  • The following information describes a company’s usage of direct labor in a recent period. The total direct labor cost variance i
    11·1 answer
  • Plant-wide, department, and activity-cost rates. Acclaim Inc. makes two styles of trophies, basic and deluxe, and operates at ca
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!