key terms define each of the following terms using graphs or equations to illustrate 1549941

KEY TERMS Define each of the following terms using graphs or equations to illustrate

your answers whenever feasible:

a. Risk; stand-alone risk; probability distribution

b. Expected rate of return, r

c. Standard deviation, ; coefficient of variation (CV)

d. Risk aversion; risk premium (RP); realized rate of return, r

e. Risk premium for Stock i, RPi; market risk premium, RPM

f. Expected return on a portfolio, rp; market portfolio

g. Correlation; correlation coefficient,

h. Market risk; diversifiable risk; relevant risk

i. Capital Asset Pricing Model (CAPM)

j. Beta coefficient, b; average stock’s beta, bA

k. Security Market Line (SML) equation