Point $A,$ where the line $r_{RF}MZ$ is tangent to indifference curve $I_2,$ represents:

A portfolio that is dominated by portfolio $B.$

A portfolio that is dominated by some point along the line $r_{RF}MZ.$

A portfolio that combines the risk$-$free asset with a portfolio of risky assets.

A portfolio that provides a riskless return.

Which of the following is the correct expression for the Capital Market Line?

hat$(r{)}_p=r_{RF}+[\frac{\text{h}\text{a}\text{t}(r{)}_M-r_{RF}}{{}_M}].$

hat$(r{)}_p=r_{RF}+[\frac{\text{h}\text{a}\text{t}(r{)}_M-r_{RF}}{{}_M}]{}_p$

hat$(r{)}_p=[\frac{\text{h}\text{a}\text{t}(r{)}_M-r_{RF}}{{}_M}]{}_p.$

hat$(r{)}_M=r_{RF}+[\frac{\text{h}\text{a}\text{t}(r{)}_p-r_{RF}}{{}_M}]{}_p.$

Suppose that the return on the risk$-$free asset is $r_{RF}=5\%,$ the return on the market portfolio is hat$(r{)}_M=10\%,$ the market risk is ${}_M=10\%,$ and the portfolio risk is ${}_p=5\%.$ Then the expected rate of return on an efficient portfolio equals

Generally, a riskier portfolio would have rate of return.

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