The intercept point of the security market line is the rate of return which corresponds to:...

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The intercept point of the security market line is the rate of return which corresponds to:...

The intercept point of the security market line is the rate of return which corresponds to: Group of answer choices

a. a value of 0.

b. the risk-free rate of return.

c. a value of 1.

d. the beta of the market.

e. the market rate of return.

business finance

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Answer 1

Answer #1

In the security market line (SML) , the y- intercept of the line is the risk free rate and the slope is the market risk premium.

Answer is b. the risk-free rate of return.

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Answer 2

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