Which of the Following Is a Second Way of Formulating

question 20

Multiple Choice

Which of the following is a second way of formulating the Markowitz model?

• A)Maximizing the expected return of the portfolio subject to a constraint on variance
• B)Minimizing the expected return of the portfolio subject to a constraint on variance.
• C)Maximizing the variance of the portfolio subject to a constraint on the expected return of the portfolio
• D)Maximizing the variance of the portfolio with no constraint needed for the expected return of the portfolio

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Definitions:

Marketable Securities

Financial instruments that can easily be converted into cash, typically with high liquidity and short maturity periods.

Short-Term Financing

Borrowing options intended for use over a short period, often to support the day-to-day operations of a business.

Maturity Factoring

Short-term financing in which the factor purchases all of a firm’s receivables and forwards the proceeds to the seller as soon as they are collected.

Short-Term Financing

Borrowing funds or obtaining financial support for a short duration, typically less than a year, to cover immediate needs.