The Y-Axis Intercept of the SML Indicates the Return on the Individual

question 27

True/False

The Y-axis intercept of the SML indicates the return on the individual asset when the realised return on an average share (beta = 1.0) is zero.

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Definitions:

Negative Punishment

involves removing a desirable stimulus after a behavior to decrease the likelihood of that behavior occurring again.

Reinforcement

In operant conditioning, any event that strengthens the behavior it follows.

Aversive Event

An unpleasant or painful stimulus that induces changes in behavior through negative reinforcement or punishment.

Inappropriate Behavior

Actions or responses that are unsuitable or not fitting for the context or situation in which they occur.