A situation in which all investors possess the same perceptions with regard to the expected returns, standard deviations, and covariances of the securities is referred to as

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When all investors have the same perceptions of the expected returns, standard deviations, and covariances of securities, it is referred to as homogeneous expectations. This means that all investors share the same beliefs about the future performance of the securities, which can lead to similar investment decisions being made by all investors. Heterogeneous expectations refer to a situation in which investors have different beliefs about the future performance of securities. Nonsatiation is a concept in economics that suggests individuals always want more of a good or service, while rational expectations are a theory that assumes individuals use all available information to make rational decisions.

A Situation in Which All Investors Possess the Same Perceptions