The efficient frontier is defined by the set of portfolios that,for each volatility level,maximizes the expected return.According to the capital asset pricing model(CAPM)
which of the following statements are correct with respect to the efficient frontier?
A.The capital market line always has a positive slope and its steepness depends on the market risk premium and the volatility of the market portfolio.
B.The capital market line is the straight line connecting the risk-free asset with the zero beta minimum variance portfolio.
C.Investors with the lowest risk aversion will typically hold the portfolio of risky assets that has the lowest standard deviation on the efficient frontier.
D.The efficient frontier allows different individuals to have different portfolios of risky assets based upon their individual forecasts for asset returns.
Answer:A
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