The following graph represents the relationship between the efficient set of possible portfolios and various investors.

Assuming that the black line represents the efficient frontier, which of the following best describes portfolios that lie to the left of this line?

Unattainable

Efficient

Indifferent

Inefficient

On the preceding graph, the green and blue lines represent the indifference curves of two investors, investor Green and investor Blue. What is an indifference curve?

The required return for a given level of risk

The efficient set of portfolios for each investor

The current yields of portfolios held by each investor

The attainable set of portfolios for each investor

Do the indifference curves shown on the preceding graph represent investor Blues greatest possible level of satisfaction?

Yes. Each investor has only one indifference curve.

There is not enough information to determine investor Blues level of satisfaction.

Yes. Any point along the curve that intersects the frontier is optimal.

No. Investor Blue could move to a higher indifference curve on his or her indifference map and achieve a higher level of satisfaction.