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Explain the term Portfolio and cite an example (3 marks) b) An investor holds the following four (4) portfolios A 14 6 B 12 5
Explain the term Portfolio and cite an example (3 marks) b) An investor holds the following four (4) portfolios A 14 6 B 12 5 C 11 8 D 17 9 If the market return is 12% with a standard deviation of 5% and risk free rate of 8%, Required: i) Determine using the capital market line equation which of the portfolios are efficient and which are inefficient. (8 Marks) ii) For the inefficient portfolios, determine what their standard deviation should be to attain efficiency
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