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Which statement (s) is/are correct?
a.The efficient frontier shows all possible returns open to the individual to choose from based on their own attitude towards risk and return.
b.Each point on the frontier represents a particular and different combination of risky and risk free assets
c.both (a) and (b)
d.None of the above
If the returns on two assets are perfectly positively correlated and an equally weighted portfolio consisting of the two assets is formed, the standard deviation of the resulting portfolio will be:
a.Below the average of the standard deviations of the two assets
b.Above the average of the standard deviations of the two assets
c.The average of the standard deviations of the two assets
d.Cannot be determined
The Beta of the market
a.Is zero because there is no non-systematic risk
b.Is zero because there is no systematic risk
c.Is lower than that for every asset apart from the risk free asset
d.None of the above
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