MetaIn the market, there are only $3$ assets: the Treasury Bill, Apple stock, and Microsoft stock. The volatilities of Apple stock and Microsoft stock are $15\%$ and $20\%,$ respectively. The expected returns of Apple stock and Microsoft stock are $14\%$ and $18\%,$ respectively. The correlation between Apple stock and Microsoft stock is $0\mathrm{.}3.$ Investors can create complete portfolios out of the T$-$bill and a risky Portfolio P consisting of the Apple stock and the Microsoft stock.

Label the following statements as correct $($C$)$ or Incorrect $($I$).$ Explain your answers $($Note that most of the points will be given to the explanation$).$

A$.$ Investing $100\%$ in Microsoft stock is the most efficient investment strategy as it gives investors the highest expected return.

B$.$ In the expected return$-$ volatility space, the efficient frontier created out of the $2$ risky assets $($Apple and Microsoft stock$)$ goes through the Microsoft stock but lies above the Apple stock.

C$.$ In the expected return$-$ volatility space, the efficient frontier created out of the $3$ assets lies above Apple stock but below Microsoft stock.

D$.$ Paul is more risk averse than Michelle. This means that in the optimal RISKY portfolios of these investors, Paul invests a smaller fraction in Microsoft stock compared to Michelle as Microsoft stock carries lower risk.