Which of the Following Statements Is CORRECT?
A) the Capital $\hat{r}$

question 16

Multiple Choice

Which of the following statements is CORRECT?

• A) The Capital Market Line (CML) is a curved line that connects the risk-free rate and the market portfolio.
• B) The slope of the CML is ( \( \hat{r} \) M - rRF)/bM.
• C) All portfolios that lie on the CML to the right of \(\sigma\)M are inefficient.
• D) All portfolios that lie on the CML to the left of \(\sigma\)M are inefficient.
• E) The slope of the CML is ( \( \hat{r} \)M - rRF)/\(\sigma\)M..

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