curves reflectwhile the efficient set of portfolios a. portfolio possibilities; investor preferences. b. investor preferences; portfolio possibilities. portfolio return; investor risk. investor preferences; portfolio return. C. d. 31. According to Markowitz, an efficient portfolio is one that has the a. largest expected return for the smallest level of risk b. largest expected return and zero risk c. largest expected return for a given level of risk d. smallest level of risk 32. The optimal portfolio is the efficient portfolio with the a. lowest risk b. highest risk c. highest utility d. least investment 33. Choose the portfolio from the following set that is not on the efficient frontier. a. A: expected return of 10 percent, standard deviation of 8 percent b. B: expected return of 18 percent; standard deviation of 13 percent c. C: expected return of 38 percent; standard deviation of 38 percent d. D: expected return of 15 percent; standard deviation of 14 percent 34. Because of increasing correlation between U.S. markets and foreign markets, most professional investors now recommend: a. zero exposure to foreign markets for the foreseeable future b. replacing foreign stock exposure with U.S. Treasury bonds c. maintaining some reasonable exposure to foreign markets d. replacing foreign stock exposure with sovereign debt from investment grade countries