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  3. Study Set
    Essentials of Investments Study Set 1
  4. Exam
    Exam 7: Capital Asset Pricing and Arbitrage Pricing Theory
  5. Question
    If All Investors Become More Risk Averse, the SML Will
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If All Investors Become More Risk Averse, the SML Will

Question 3

Question 3

Multiple Choice

If all investors become more risk averse, the SML will ________ and stock prices will ________.


A) shift upward; rise
B) shift downward; fall
C) have the same intercept with a steeper slope; fall
D) have the same intercept with a flatter slope; rise

Correct Answer:

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