Match the terms relating to the basic terminology and concepts of risk and rates of return the descriptions of the terms. Read each description carefully and select the correct term. These are not necessarily complete definitions, but there is only one possible answer for each term.

Description	Term
The general term that describes the portion of an assets total expected return that is greater than the return earned on the markets risk-free rate.
The risk of an asset when it is the only asset in an investors portfolio.
The condition in which the expected return on a security equals its required return, and there is no pressure on its price to change.
A measurement of the tendency of two variables to move together.
A measure of the extent to which the returns on a given investment are correlated with the returns of a market portfolio.
This model determines the appropriate required return on a security as the sum of the markets risk-free rate and a risk premium based on the markets risk premium and the securitys beta coefficient.
The result of adding additional assets to a portfolio, when the returns of the individual assets are non-correlated.
That portion of an investments risk calculated as the difference between its total risk and its firm-specific risk.
The potential for variability in the possible outcomes associated with an investment.
The rate of return expected to be realized from an investment, calculated as the mean of the probability distribution of its possible returns.

Terms:

Beta Coefficient

Capital Asset Pricing Model

Correlation coefficent (p)

Diversification

Equillibrium

Expected Rate of Return

Market Risk

Risk

Risk Premium

Stand-alone risk