CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

For an investor borrowing money at the risk-free interest rate to invest in the market portfolio, the estimated rate of return of his portfolio is most likely to ______.
A. decrease
B. increase
C. remain unchanged
Explanation: An investor who wants to attain a higher estimated rate of return than the market portfolio may want to use leverage by borrowing money at the risk-free rate of interest.

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