Which of the Following Is Least Likely to Move a Firm's

question 70

Multiple Choice

Which of the following is least likely to move a firm's position to the right on the Security Market Line (SML) ?

• A) An increase in the firm's beta
• B) Adding more financial debt to the firm's balance sheet relative to equity
• C) Changing the business strategy to include new product lines with more volatile expected cash flows
• D) Investors perceive the stock as being more risky
• E) An increase in the risk-free required rate of return.

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Definitions:

Psychodrama

A therapeutic technique wherein patients act out events from their lives, fantasies, or dreams, often in a group setting, to gain insight, catharsis, or behavioral change.

Mental Health Agency

An organization or institution that provides services and support for individuals with mental health problems or disorders.

Stress Management

Techniques and strategies aimed at controlling a person's level of stress, especially chronic stress, in order to improve everyday functioning.

Group-level Treatments

Interventions or therapies applied to a group of individuals to address common issues or behaviors.