Refer to the graph. Suppose a particular ﬁnancial asset's risk and return proﬁle puts it at point E. The process of arbitrage will
A) move the ﬁnancial asset to point G on the Security Market Line.
B) move the ﬁnancial asset to point D.
C) move the ﬁnancial asset to point F.
D) not change the ﬁnancial asset's position on the Security Market Line.

Question

Refer to the graph. Suppose a particular ﬁnancial asset's risk and return proﬁle puts it at point E. The process of arbitrage will
A) move the ﬁnancial asset to point G on the Security Market Line. 
B) move the ﬁnancial asset to point D. 
C) move the ﬁnancial asset to point F. 
D) not change the ﬁnancial asset's position on the Security Market Line.

Quizplus · Accepted Answer

The Answer of  Refer to the graph. Suppose a particular ﬁnancial asset's risk and return proﬁle puts it at point E. The process of arbitrage will
A) move the ﬁnancial asset to point G on the Security Market Line. 
B) move the ﬁnancial asset to point D. 
C) move the ﬁnancial asset to point F. 
D) not change the ﬁnancial asset's position on the Security Market Line.

Refer to the Graph