Question: Choice: Valid, Cannot be determined, Invalid According to the two funds theorem, if twotches solutions of the Markowitz problem, when shorting is allowed, are known

Choice: Valid, Cannot be determined, Invalid

Choice: Valid, Cannot be determined, Invalid According to the two funds theorem,

According to the two funds theorem, if twotches solutions of the Markowitz problem, when shorting is allowed, are known then investors seeking efficient portfolios need only invest in the risk free rate and in one master efficient fund. [ Choose ] The efficient frontier is a straight line when a risk free asset is available. When a risk free asset is available, investorshoose seeking efficient portfolios allocate capital between a single fund F of risky assets and the risk free asset. [ Choose ] The variance of a portfolio increases by including additional assets in the portfolio. Choose ]

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