The relevant measure of risk for a diversified portfolio of assets is the portfolio%u2019s level of: Answer

systematic risk

unsystematic risk

diversifiable risk

company specific risk The linear relation between the returns on a stock and the returns on the market portfolio is called the: Answer

alpha

beta

covariance

coefficient of variance A (n) ________ portfolio maximizes return for a given level of risk, or minimizes risk for a given level of return. Answer

efficient

profit maximizing

idiosyncratic

diverse The Security Market Line describes the relationship between the: Answer

expected return on securities and their systematic risk

expected return on securities and their unsystematic risk

expected return on a security and the expected return on the market portfolio

risk-free rate and the expected return on the market portfolio The portfolio that contains all risky assets is known as the: Answer

		market portfolio
		efficient portfolio
		efficient frontier
		value-weighted portfolio