1,An efficient portfolio is one that:

Select one:

a.

maximises return for a given level of risk

b.

maximises risk for a given level of return.

c.

minimises risk for a given rate of return.

d.

Both A and C. are efficient portfolios

2,Which of the following statements is correct?

Select one:

a.

Assuming a correlation coefficient of 0 between two assets, the portfolio's standard deviation will be lower than the weighted average of the individual assets' standard deviation.

b.

Assuming a correlation coefficient of +1 between two assets, the portfolio's standard deviation will be lower than the weighted average of the individual assets' standard deviation.

c.

Assuming a correlation coefficient of +1 between two assets, the portfolio's standard deviation will be the same as the weighted average of the individual assets' standard deviation.

d.

Both A and C