Which statement is true regarding the capital market line (CML)?
I) The CML is the line from the risk-free rate through the market portfolio.
II) The CML is the best attainable capital allocation line.
III) The CML is also called the security market line.
IV) The CML always has a positive slope.
A. I only
B. II only
C. III only
D. IV only
E. I, II, and IV
E. I, II, and IV
Both the capital market line and the security market line depict risk/return relationships. However, the risk
measure for the CML is standard deviation and the risk measure for the SML is beta (thus the CML is not also called the security market line; the other statements are true).
You might also like to view...
Sample surveys are classified as descriptive, cross-sectional studies whose samples are drawn in such a way as to be representative of a specific population
Indicate whether the statement is true or false
Conflict management styles have been correlated with other dispositions, such as individuals high in a compete style are higher in risk taking, less internally controlled, lower on needs for power and control, and higher on needs for affiliation.
Answer the following statement true (T) or false (F)
Individuals with independent self-concepts are more likely to be ______ communicators.
A. metaphorical B. high-context C. ambiguous D. low-context
The sensitivity analysis report generated by Excel solver has ______ major components.
a. two b. three c. four d. five