The measure of risk in a Markowitz efficient frontier is:
A)specific risk.
B)standard deviation of returns.
C)reinvestment risk.
D)beta.
E)none of the above.

Question

Quizplus · Accepted Answer

The measure of risk in a Markowitz efficient frontier is the standard deviation of returns. Markowitz efficient frontier is a graphical representation of the highest expected return that can be achieved for a certain level of risk. The risk here is defined as the volatility or variability of returns, which is measured by the standard deviation of returns. Therefore, option B is the correct answer. Options A, C, and D are not correct as they do not represent the measure of risk in a Markowitz efficient frontier.

The Measure of Risk in a Markowitz Efficient Frontier Is