Which of the Following Is a TRUE Statement

question 100

Multiple Choice

Which of the following is a TRUE statement?

• A)The tangent portfolio is the risky portfolio on the efficient frontier whose tangent line cuts the horizontal axis at the risk-free rate.
• B)The new (or super)efficient frontier represents the portfolios composed of the risk-free rate and the tangent portfolio that offers the highest expected rate of return for any given level or risk.
• C)The separation theorem states that the investment decision, (how to construct the portfolio of risky assets), is not separate from the financing decision, (how much should be invested or borrowed in the risk-free asset).
• D)The market portfolio is a portfolio that contains some risky securities in the market.

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Definitions:

Embolus

An embolism can occur when a blood clot, air bubble, piece of fatty deposit, or another foreign object travels through the bloodstream and becomes lodged in a blood vessel.

Cerebral Artery

A Cerebral Artery is a blood vessel that supplies blood to the brain, helping deliver oxygen and nutrients critical for its function.

Aortic

Relating to the aorta, the largest artery in the body, which carries oxygenated blood from the heart to the rest of the body.

Cusps

Pointed or rounded projections on the chewing surface of teeth, or flap-like structures in the heart valves.