Given an Optimal Risky Portfolio with Expected Return of 6

question 25

Multiple Choice

Given an optimal risky portfolio with expected return of 6%, standard deviation of 23%, and a risk free rate of 3%, what is the slope of the best feasible CAL?

• A) 0.64
• B) 0.39
• C) 0.08
• D) 0.13
• E) 0.36

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Definitions:

Economic Villains

Individuals, organizations, or phenomena recognized for their destructive impact on economic stability, integrity, or growth.

Entrepreneurs

Individuals who create, organize, and manage a new business venture, taking on greater than normal financial risks in order to do so.

Landlords

Property owners who rent out their real estate assets to tenants in exchange for periodic payments.

Purely Competitive Economy

An idealized market structure where many firms sell identical products, entry and exit are easy, and no single buyer or seller can influence the market price.