1. a. Explain why the CML assumes a risk-free asset and that investors can borrow or lend...

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1.

a. Explain why the CML assumes a risk-free asset and that investors can borrow or lend at the risk-free rate.

b. Using a graph, demonstrate why the CML dominates the Markowitz efficient frontier.

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Foundations Of Global Financial Markets And Institutions

ISBN: 9780262039543

5th Edition

Authors: Frank J. Fabozzi, Frank J. Jones, Francesco A. Fabozzi, Steven V. Mann

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