This Is the Investor's Combination of Securities That Achieves the Highest

question 50

Multiple Choice

This is the investor's combination of securities that achieves the highest expected return for a given risk level.

• A) efficient portfolio
• B) modern portfolio
• C) optimal portfolio
• D) total portfolio

---

Definitions:

Diseconomies

Negative effects on costs that occur as a business expands, typically resulting from inefficiencies that stem from managerial and operational challenges.

Expansion Path

A curve in input space showing how the optimal mix of inputs changes as the firm expands output.

Fixed Proportion

Refers to a production process where inputs must be used in strict, unchanging ratios to produce an output.

Capital

Assets used for the production of goods and services, such as buildings, machinery, and equipment.