Answer (C) is correct . A feasible portfolio that offers the highest expected return for a given risk or the least risk for a given expected return is called an efficient portfolio.
Answer (A) is incorrect because An optimal portfolio is a portfolio selected from the efficient set of portfolios because it is tangent to the investor’s highest indifference curve.
Answer (B) is incorrect because A desirable portfolio is a nonsense term.
Answer (D) is incorrect because An effective portfolio is a nonsense term.
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