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In: Economics

3. With the aid of a diagram, answer the following questions: (i) What is meant by...

3. With the aid of a diagram, answer the following questions:

(i) What is meant by the term Efficient Frontier? (Assume no short sales and no riskless lending and borrowing allowed.)

(ii) ‘The mean-variance efficiency criterion can identify the optimal investment’. Do you agree this statement? Explain your answer.

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