The investors degree of risk aversion is characterized by the slope of the indifference curve. Indifference curves

Question:

The investor’s degree of risk aversion is characterized by the slope of the indifference curve.

Indifference curves show, at any level of expected return and risk, the required risk premium for taking on each additional percentage point of standard deviation. More risk-averse investors have steeper indifference curves; that is, they require a greater risk premium for taking on more risk. p-936

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

ISE Investments

ISBN: 9781266085963

13th International Edition

Authors: Zvi Bodie, Alex Kane, Alan Marcus

Question Posted: