Accountancy, asked by aishaimran14, 3 months ago

What will happen to the Security Market Line if (1) inflation expectations increase and (2) investors become more risk averse?

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Answered by mahrashtriangirl

Answer:

Financial risk. 13. What will happen to the security market line (SML) if the following events occur, other things constant: (1) inflation expectations increase, and (2) investors become more risk averse? ... The relative ease or tightness in capital markets and the expected rate of inflation.

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