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The capital allocation line (CAL) represents the risk-return trade-off of a portfolio that combines a risk-free asset and a risky asset or portfolio of assets. It is a graphical line that shows the expected return of a portfolio against its risk, measured by standard deviation. The slope of the CAL indicates the risk premium per unit of risk, helping investors determine the optimal mix of risk-free and risky investments to achieve their desired return. The point where the CAL is tangent to the efficient frontier represents the optimal risky portfolio.
What else can I help you with?
What is an effective capital allocation process?
encourages innovation
What is the entity that is responsible for establishing the allocation and cost of capital?
The corporation
The entity that is responsible for establishing the allocation and cost of capital is?
investors
Workers on an assembly line are an example of?
Spideris says it is allocation
What does efficient resource allocation mean?
economic resources-land, labor and capital-will be used for their most valuable purposes.
What is an effective capital allocation process?
encourages innovation
What is the entity that is responsible for establishing the allocation and cost of capital?
The corporation
The entity that is responsible for establishing the allocation and cost of capital is?
investors
Workers on an assembly line are an example of?
Spideris says it is allocation
Where would you look to see the line lines in a transaction?
The user line items tab
How do you hyphenate allocation?
Allocation is not a hyphenated word. If the question is how is it divided into syllables for breaking across a line, that would be al-lo-ca-tion.
Does the capital letter a have a line of symmetry?
Yes capital A has one line of symmetry or 'mirror image'
What does efficient resource allocation mean?
economic resources-land, labor and capital-will be used for their most valuable purposes.
What are the differences between capital allocation line CAL and capital market line CML?
CML = CAL for the entire market, assuming everyone has the same mean variance expectations ( E(R), variances, correlations). CAL is just the CML for individual investors. CAL and CML both combine the risk free asset with the optimal portfolio, only with CML that optimal portfolio is the market portfolio (tangency point of CML).
Is Old Line State the capital of Maryland?
No, Annapolis is the capital of Maryland whose Motto is the Old Line State.
When is the allocation of resources in an economy considered to be inefficient?
when total resources in an economy is not equally allocated among four factors of production i.e land, labor, capital and organization then allocation of resources in an economy considered to be inefficient.
Example of risk in capital budgeting?
its to maintain cost effectiveness its allocating the capital among different branches like marketing, finance, adds....... ex: allocation of budget for marketing activities
