An Efficient Set of Portfolios Is Comprised Of

question 39

Multiple Choice

An efficient set of portfolios is comprised of:

• A)a complete opportunity set.
• B)the portion of the opportunity set located below the minimum variance portfolio.
• C)only the minimum variance portfolio.
• D)the dominant portion of the opportunity set.
• E)only the maximum return portfolio.

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Definitions:

Present Value

The modern-day valuation of upcoming money amounts or cash flow sequences, adjusted according to a given rate of return.

Bank Account

A financial account maintained by a bank for a customer, allowing the customer to deposit and withdraw money and possibly earn interest.

Equal Payments

Installments of the same amount paid or received over a specified period for loans, mortgages, or annuities.

Present Value

Today's monetary value of a sum to be received in the future or of future cash inflows, using a specified rate of return for calculation.