The risk-free rate, average returns, standard deviations, and betas for three funds and the S&P 500 are given below.

Fund Avg. Std Dev. Beta

A. 18% 30% 1.05

B 25% 35% 1.3

C 20%. 25%. 1.2

S&P 500. 15%. 20%. 1

_{Rf rate 5%}

_{If these portfolios are sub-components that make up part of a well-diversified portfolio, then -------- is preferred.}

_{a. A}

_{b. B}

_{c. C}

_{d. D}