The Security Market Line (SML) Is Upward-Sloping, Indicating That the

question 76

Multiple Choice

The Security Market Line (SML) is upward-sloping, indicating that the

• A) beta of an investment increases as its risk level increases.
• B) average expected return on investments decreases as their risk level decreases.
• C) average expected return on the risk-free asset increases as its beta increases.
• D) average expected return of the market portfolio increases as its beta increases.

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Definitions:

Theory Y

A management concept that assumes employees are inherently motivated and enjoy their work, requiring less supervision and more collaboration and trust.

Frank Gilbreth

An American engineer, consultant, and author, best known for his work in time and motion study alongside his wife Lillian Gilbreth.

Lillian Gilbreth

Lillian Gilbreth was a pioneering engineer and psychologist known for her contributions to industrial management and ergonomics, often working alongside her husband, Frank Gilbreth.

Frederick Taylor

Known as the father of scientific management, he introduced efficiencies in industrial productivity through time-and-motion studies and standardized tasks.