Other things held constant, if the expected inflation rate DECREASES, and investors also become MORE risk averse, the Security Market Line would shift in<u> have a steeper slope </u>manner.
<h3>What is the Security Market Line (SML)?</h3>
The security market line (SML) is the Capital Asset Pricing Model (CAPM). It gives the market’s expected return at different levels of systematic or market risk. It is also called the ‘characteristic line’ where the x-axis represents the asset’s beta or risk, and the y-axis represents the expected return.
<u>Security Market Line Equation</u>
The Equation is as follows:
SML: E(Ri) = Rf + βi [E(RM) – Rf]
In the above security market line formula:
- E(Ri) is the expected return on the security.
- Rf is the risk-free rate and represents the y-intercept of the SML.
- βi is a non-diversifiable or systematic risk. It is the most crucial factor in SML. We will discuss this in detail in this article.
- E(RM) is expected to return on market portfolio M.
- E(RM) – Rf is known as Market Risk Premium.
<u>Characteristics of the Security Market Line (SML) are as below:</u>
- SML is a good representation of investment opportunity cost, which combines the risk-free asset and the market portfolio.
- Zero-beta security or zero-beta portfolio has an expected return on the portfolio, which is equal to the risk-free rate.
- The slope of the Security Market Line is determined by the market risk premium, which is: (E(RM) – Rf). Higher the market risk premium steeper the slope and vice-versa
- All the assets which are correctly priced are represented on SML.
- The assets above the SML are undervalued as they give a higher expected return for a given amount of risk.
- The assets below the SML are overvalued as they have lower expected returns for the same amount of risk.
Therefore, we can conclude that the correct option is A.
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Of the following, an example of eustress is getting excited about being promoted. (Option A)
Stress is defined as a normal physiological and psychological response to their circumstances. Eustress is a term used to describe stress that is motivating, positive, and enhances functioning. It is a beneficial stress which could be physical, psychological, or biochemical/radiological. The term was framed by endocrinologist Hans Selye, and literally meaning "good stress". It is the opposite of distress which refers to bad and overwhelming stress that impairs functioning. Hence, of the given options, getting excited due to a promotion is an example of eustress as it is a good or beneficial stress.
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Answer:
that pretty good but no offense but the face is a bit mishapen but its still really good
Explanation:
Answer:
When you become a adult things change, Y o u r l if e c h a n g e s t o o its hard for kids to focus on what matters when there older.
Hope this helps
Explanation:
The unequal access of males and females to property power and prestige is referred to as "<span>Gender stratification".
Gender stratification alludes to the level of disparity in the public arena in light of sex, the social qualities related with sex. In particular, gender stratification alludes to the differential capacity of people to get to society's assets and to get its benefits. As gender stratification expands, so does the level of sex imbalance, reflecting more prominent contrasts amongst people's entrance to control.
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