An efficient portfolio is one that
A) maximizes risk for a given level of return.
B) maximizes return for a given level of risk.
C) minimizes return for a given level of risk.
D) maximizes return at all risk levels.

Question

Quizplus · Accepted Answer

An efficient portfolio is one that maximizes return for a given level of risk. This means that it provides the highest return for a certain level of risk, or the lowest risk for a certain level of return. It is the optimal balance between risk and return, and is desirable for investors who want to achieve their investment goals while minimizing risk.

An Efficient Portfolio Is One That