Which of the following portfolio risk-return combinations yields the best CAL for investors assuming a risk- free rate of 4.2%? O a. E[r] = 20.6%, O = 22.3% O b. E[r] 16.3%, O = 42.9% Oc. E[r]= 19.8%, = 33.4% O d. E[r] = 10.5%, O = 17.8% e. E[r]=7.8%, σ = 36.4% =

Which of the following portfolio risk-return combinations yields the best CAL for investors assuming a risk- free rate of 4.2%? O a. E[r] = 20.6%, O = 22.3% O b. E[r] 16.3%, O = 42.9% Oc. E[r]= 19.8%, = 33.4% O d. E[r] = 10.5%, O = 17.8% e. E[r]=7.8%, σ = 36.4% =

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

Which of the following portfolio risk-return combinations yields the best CAL for investors assuming a risk-
free rate of 4.2%?
a. E[r] =20.6%, o = 22.3%
O b. E[r] = 16.3%, σ = 42.9%
c. E[r]=19.8%, = 33.4%
d. E[r]= 10.5%, σ = 17.8%
e. E[r]=7.8%, σ = 36.4%

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