When Is a Portfolio Considered to Be Efficient

question 75

Multiple Choice

When is a portfolio considered to be efficient?

• A) When no other portfolio offers higher expected returns with the same risk.
• B) When no other portfolio offers lower risk with the same expected return.
• C) When there is no portfolio with a higher return.
• D) Choices a and b
• E) All of the above.

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Definitions:

Government Sets Prices

A situation where the government determines the selling prices of goods and services, often to stabilize the economy or ensure affordability.

Market Economy

An economic system in which production and prices are determined by unrestricted competition between privately owned businesses.

Karl Marx

A 19th-century philosopher, economist, and political theorist known for his critical analysis of capitalism and his contributions to the foundation of socialism and communism.

Communist Countries

Nations that practice communism, a political and economic ideology characterized by the collective ownership of property and the organization of labor for the common advantage of all members.