The Goal of an Efficient Portfolio Is to ________

question 14

Multiple Choice

The goal of an efficient portfolio is to ________.

• A) achieve a predetermined rate of return for a given level of risk
• B) maximize risk in order to maximize profit
• C) minimize profit in order to minimize risk
• D) minimize risk for a given level of return

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Definitions:

Check

A written order on a bank or banker payable on demand to the person named or his order or bearer and drawn by virtue of credits due the drawer from the bank created by money deposited with the bank.

Conditional Indorsement

Refers to a signature on a financial document, such as a check, that limits the conditions under which it can be valid.

Negotiability

The quality of a financial instrument, such as a check or bill of exchange, that allows it to be transferred from one party to another through endorsement or delivery.

Traveler's Checks

Preprinted, fixed-amount checks designed to allow the person signing it to make an unconditional payment to someone else as a result of having paid the issuer for this privilege.