_____ Are Behavioral and Cognitive Tendencies That Affect Behavior

question 20

Short Answer

_____ are behavioral and cognitive tendencies that affect behavior.

---

Definitions:

Systematic Risk

The risk inherent to the entire market or market segment, unavoidable through diversification.

Security Market Line

A line that represents the relationship between the risk of an investment and its expected return, based on the capital asset pricing model (CAPM).

Risk-Free Rate

The theoretical rate of return on an investment with no risk of financial loss, often represented by government bonds.

Unsystematic Risk

The type of risk that is specific to a company or industry, stemming from factors like management decisions or regulatory changes, and can be mitigated through diversification.