Question: Using Figure 6.17, explain how various portfolio possibilities are created by combining risk assets and risk free asset. You are required to use all the

Using Figure 6.17, explain how various portfolio possibilities are created by combining risk assets and risk free asset. You are required to use all the portfolio possibilities identified in Figure 6.17.

Figure 6.17: Portfolio possibilities

Exhibit 6. 17 Portfolio Possibilities Combining the Risk-Free Asset and Risky Portfolios on the Efficient Frontier E(Rport) CML E Markowitz Efficient D Frontier M B A RFR - - 6c 6 M OF port

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