Which of the following statements is/are true with respect Capital Market Line (CML)?I. It is the line passing from risk-free rate through market portfolio. II. The slope of CML is called market price of risk. III. CML fails to express equilibrium pricing relationship between expected return and standard deviation for all efficient portfolios lying along the line.

– by
Question:

Which of the following statements is/are true with respect Capital Market Line (CML)?I. It is the line passing from risk-free rate through market portfolio. II. The slope of CML is called market price of risk. III. CML fails to express equilibrium pricing relationship between expected return and standard deviation for all efficient portfolios lying along the line.

A.

Only (I) above

B.

Only (II) above

C.

Only (III) above

D.

Both (I) and (II) above

Answer» d. Both (I) and (II) above

Note: The above multiple-choice question is for all general and Competitive Exams in India.