Answer: I believe the answer is the first one, rain forests, deforestation, water cycle.
Explanation: I think so because the words in that answer include the important keywords of the paragraph above.
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.
Learn more about Security Market Line (SML) on:
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I pretty sure it was a system to deliver messages.
<span>while they create the illusion of listening they mostly do what they think is required to be re-elected.
Note the current republicans who are silent on tweets etc. Teh don't want to get involved so their action/speech can be used against them in future elections</span>
Answer: International regime
Explanation: The concept was first introduced to international relations by John Ruggie in 1975 but the most widely known definition was given by krasner.
He defined it as a ‘set of implicit or explicit principles, norms, rules, and decision-making procedures around which actors' expectations converge’ in 1983. It was further explained that although regimes include formal treaties and national law, they also rely on informal norms and networks to develop and enforce standard behavior in an area of global policy.
