One of the ways to formulate the Markowitz model is to a. ...

[casperchen82]

One of the ways to formulate the Markowitz model is to
 a. maximize the variance of the portfolio subject to a constraint on the expected return of the portfolio.
  b. minimize the expected return of the portfolio subject to a constraint on variance.
  c. minimize the variance of the portfolio subject to a constraint on the expected return of the portfolio.
  d. minimize the expected return of the portfolio with no constraint on variance.

Question 2

Assessing the regression model on data other than the sample data that was used to generate the model is known as
 a. approximation. b. cross-validation.
  c. graphical validation. d. postulation.

[Pamela.irrgang@yahoo.com]

Answer to Question 1

c
RATIONALE: One of the ways to formulate the Markowitz model is to minimize the variance of the portfolio subject to a constraint on the expected return of the portfolio.

Answer to Question 2

b
RATIONALE: Assessing the regression model on data other than the sample data that was used to generate the model is known as cross-validation.