The reward/variability ratio is given by _________.
A) the slope of the capital allocation line
B) the second derivative of the capital allocation line
C) the point at which the second derivative of the investor's indifference curve reaches zero
D) portfolio excess return

Question

Quizplus · Accepted Answer

The reward/variability ratio, also known as the Sharpe ratio, is represented by the slope of the capital allocation line. It measures the trade-off between risk and return.

The Reward/variability Ratio Is Given by _________