Refer to the Graph

question 75

Multiple Choice

Refer to the graph.If a financial asset's average expected rate of return and beta put it at point F,

• A)arbitrage will push down the price of the asset and lower the average expected rate of return to Y.
• B)arbitrage will push up the price of the asset and lower the average expected rate of return to Y.
• C)a restrictive monetary policy is needed to move the asset onto the Security Market Line.
• D)an expansionary monetary policy is needed to move the asset onto the Security Market Line.

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