Which of the Following Properties Can Be Associated with an Indifference

question 32

Multiple Choice

Which of the following properties can be associated with an indifference curve of a risk-averse investor?

• A)Indifference curve for a risk-averse investor is a vertical line parallel to the variance axis.
• B)Two indifference curves can intersect at the equilibrium combination of risk and return.
• C)An indifference curve closer to the expected return axis gives a better utility than the one farther away.
• D)Indifference curve for a risk-averse investor is always downward sloping.

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Definitions:

Psychoanalytic Theories

A set of theories which focus on the unconscious mind and the importance of childhood experiences in shaping personality and behavior.

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