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Fiscal policy:
Risk Level
The potential for losing something of value, measured in the context of investment as the uncertainty regarding the return or the possibility of losing some or all of the original investment.
Capital Allocation Line
A line on a graph that shows the risk-reward ratio of different portfolios, helping investors understand their options for achieving a desired balance.
Risk-averse Investors
Investors who prefer to minimize uncertainty and potential loss in their investment choices, often opting for safer, more predictable investments.
Optimal Risky Portfolio
The combination of investments that provides the highest expected return for a given level of risk or the lowest risk for a given level of expected return.
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