Solved

As Part of a Promotion for the Awareness of Communicable

question 3

Multiple Choice

As part of a promotion for the awareness of communicable diseases in a rural area, Willy, a medical intern, was asked to educate the locals. After a small presentation, Willy asked a few questions to check their understanding of what he spoke about. The locals were not able to answer one single question as they were not familiar with most of the medical terms that Willy used in his presentation. This type of language is called

Definitions:

Stable Equilibrium

A state in which a system, once disturbed, returns to its original condition because the equilibrium is stable.

Expected and Required Returns

The returns that investors anticipate or demand from an investment considering its risk, often guiding investment decisions.

SML

Stands for Security Market Line; it represents the relationship between the expected return of an investment and its risk in the capital asset pricing model (CAPM).

Beta of the Portfolio

An assessment of a portfolio's volatility or inherent risk, relative to the overall market.