11.Investors must be offered an expected rate of return that the risk-free rate of interest when being induced to accept a market portfolio. (a)is less than (b)is the same as (c)exceeds (d)minimizes Answer:(c) 12.The the average degree of risk aversion of the population,the the risk premium required. (a)greater;lower (b)greater;greater the insignificance of (c)lower;higher (d)greater;higher Answer:(d) 13.The slope of the Capital Market Line represents the: (a)volatility of interest rates (b)market reward-to-risk ratio (c)individual risk-to-reward ratio (d)individual preference Answer:(b) 14.Suppose the standard deviation of the market portfolio is 0.15 and the average degree of risk aversion is 1.5.Then the risk premium on the market portfolio is: (a)0.034 (b)0.051 (c0.225 (d)0.340 Answer:(a) 13-413-4 11. Investors must be offered an expected rate of return that ________ the risk-free rate of interest when being induced to accept a market portfolio. (a) is less than (b) is the same as (c) exceeds (d) minimizes Answer: (c) 12. The ________ the average degree of risk aversion of the population, the ________ the risk premium required. (a) greater; lower (b) greater; greater the insignificance of (c) lower; higher (d) greater; higher Answer: (d) 13. The slope of the Capital Market Line represents the: (a) volatility of interest rates (b) market reward-to-risk ratio (c) individual risk-to-reward ratio (d) individual preference Answer: (b) 14. Suppose the standard deviation of the market portfolio is 0.15 and the average degree of risk aversion is 1.5. Then the risk premium on the market portfolio is: (a) 0.034 (b) 0.051 (c) 0.225 (d) 0.340 Answer: (a)