返回列表 发帖

Which of the following statements best describes risk aversion?

A)
Given a choice between two assets of equal return, the investor will choose the asset with the least risk.
B)
There is an indirect relationship between expected returns and expected risk.
C)
The investor will always choose the asset with the least risk.


Risk aversion is best defined as: given a choice between two assets of equal return, the investor will choose the asset with the least risk. The investor will not always choose the asset with the least risk or the asset with the least risk and least return. As well, there is a positive, not indirect, relationship between risk and return.

TOP

According to Markowitz, an investor’s optimal portfolio is determined where the:

A)
investor's lowest utility curve is tangent to the efficient frontier.
B)
investor's utility curve meets the efficient frontier.
C)
investor's highest utility curve is tangent to the efficient frontier.


The optimal portfolio for an investor is determined as the point where the investor’s highest utility curve is tangent to the efficient frontier.

TOP

返回列表