CFAI sample exam question

Which of the following statements regarding the Markowitz efficient frontier is least likely to be correct? the optimal portfolio for A. A more risk averse investro will be different from the optimal portfolio for a less risk-averse investor B. an investor is the portfolio tht lies on the efficient frontier and provides her with eh greatest level of utility C. An investor is found at the point of tangency betewen the efficient frontier and an investor’s highest utility curve D. A more risk-averse investor will lie inside the efficient frontier but will lie outsde the efficient frontier for a less risk investor.

D.

D, you should never be inside the frontier.

Portfolios inside the efficient frontier are inefficient. So they would never be chosen by investors, risk averse or risk takers

D