Other things held constant, if the expected inflation rate decreases and investors also become more risk averse, the security market line would be affected as follows:

answer

a) the y-axis intercept would decline, and the slope would increase.

b) the x-axis intercept would decline, and the slope would increase.

c) the y-axis intercept would increase, and the slope would decline.

d) the sml would be affected only if betas changed.

e) both the y-axis intercept and the slope would increase, leading to higher required returns.

if in the opinion of a given investor a stock's expected return exceeds its required return, this suggests that the investor thinks

a) the stock is experiencing supernormal growth.

b) the stock should be sold.

c) the stock is a good buy.

d) management is probably not trying to maximize the price per share.

e) dividends are not likely to be declared.

Peppy roaney believes that pizza is a much more versatile dish than most people realize. as the national marketing manager for pizza guys, he observed how consumers were delighted with barbecue pizza, hawaiian pizza, mexican pizza and other unique combinations. his suggestions for other unusual pizzas, however, were met with a negative response by his superiors. even some of his colleagues laughed at his ideas. peppy's confidence in his ability to understand the market has led him to focus on planning a business of his own. peppy realizes that he will take a risk when he leaves his job with pizza guys and embarks upon a new venture: peppy's pizzazzeria. peppy is excited about the potential of profitably catering to the unmet desires of pizza consumers. peppy is confident that peppy's pizzazzeria will be a success, but only if he has enough money to do things right. since peppy has very little personal wealth, he knows he must obtain financial assistance. in order to prepare for meetings with bankers and p

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Read the overview below and complete the activities that follow.apartment complexes often look for ways to recruit new tenants and retain current tenants. although apartment complexes offer the tangible benefit of shelter to their tenants, many apartment complexes also offer additional services to tenants to encourage tenants to stay or to support the rent prices. the following scenario identifies the several service gaps of a company that runs an apartment complex as well as solutions for reducing these service gaps.concept review: customers have certain expectations about how a service should be delivered. a service gap occurs when the delivery of a service fails to meet customer expectations. there are four types of service gaps: knowledge gap, standards gap, delivery gap, and the communications gap. it is important for marketers to identify these gaps and develop strategies for minimizing them.match the example or solution to the appropriate service gap category.1. wait for repairs 5. train employees well2. understand expectations 6. incentives for tenants3. do not overpromise 7. family movie night4. empower employees 8. delayed lawn careservice gap example solutionknowledge gap standards gap delivery gap communication gap