CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

An investor maximizes her utility by ______
A. finding the highest indifference curve under the risk-return tradeoff.
B. choosing a point that is tangent to the efficient frontier and is on the highest feasible indifference curve.
C. choosing a point that is parallel to the efficient frontier and is on the highest feasible utility curve.
Explanation: An investor invests along the efficient frontier and chooses a point that is also on the highest feasible indifference curve. This is a point of tangency between the two.

User Contributed Comments 2

User Comment
PedroEdmundo What the difference between indifference and utility curve?
danlan They are the same.
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