Which of the Following Makes This a True Statement: the Shape

question 104

Multiple Choice

Which of the following makes this a true statement: The shape of the efficient frontier implies that:

• A)diminishing returns apply to risk-taking in the investment world.
• B)increasing returns apply to risk-taking in the investment world.
• C)returns are not impacted by risk-taking in the investment world.
• D)None of these complete the sentence to make it true.

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Definitions:

Market Price

The present market cost for transactions involving the buying or selling of assets or services.

EPS Growth Rate

The rate at which a company's earnings per share (EPS) has grown or is projected to grow during a specified time period.

Rate of Return

Monetary gain or loss on an investment throughout a set period, considered as a percentage of the investment's cornerstone cost.

Current Stock Price

The cost at which a stock is bought or sold on the stock exchange at a specific moment.