TITLE: Etale endomorphisms of abelian varieties in positive characteristic
QUESTION [15 upvotes]: Let $K$ be the function field of a smooth curve over the algebraic closure $k$ of the finite field ${\bf F}_p$ (where $p>0$ is a prime number). 
My question is : does there exist an abelian variety $A$ over $K$, with the following properties : 
(a) the $K|k$-image of $A$ is trivial;
(b) there exists an étale $K$-endomorphism of $A$, whose degree is a power of $p$ ?
The condition on the $K|k$-image can be rephrased as : there are no non-zero $K$-homomorphisms
$A\to C_K$, where $C$ is an abelian variety over $k$. 
For examples of abelian varieties satisfying condition (b) only, look at abelian varieties $C_K$, where $C$ 
is an ordinary abelian variety over ${\bf F}_p$. The abelian variety $C$ is endowed with the étale endomorphism 
given by the Verschiebung morphism. 
Also, notice that if there is an abelian variety over $K$ satisfying (a) and (b), then the dimension of $A$ is 
larger than one (ie it is not an elliptic curve). Indeed, if an elliptic curve $E$ satisfies the above conditions, then 
$E$ has an endomorphism, which is not a multiplication by a scalar and thus it has complex multiplications; this implies that it is isogenous to an elliptic curve defined over $k$, by a theorem of Grothendieck (or by more direct arguments). 
Finally, I would like to point out that 
if $A$ is an ordinary abelian variety over $K$, which has maximal Kodaira-Spencer rank, then $A[p]$$(K^{\rm sep})=0$ by a theorem 
of J-F Voloch (see p. 1093 in "Diophantine Approximation on Abelian Varieties in Characteristic $p$", 
Amer. J. Math., Vol. 117, No. 4., pp. 1089-1095); this shows that such an abelian variety 
cannot have an endomorphism as in (b).

REPLY [6 votes]: If $p-1$ is divisible by $24$ then there is an explicit example of an ordinary $7$-dimensional abelian variety $X$, whose endomorphism algebra is the imaginary quadratic field $Q(\sqrt{-3})$; in particular, $X$ is absolutely simple and its $K/k$-trace is trivial. Namely, $K$ is the field of rational functions $k(t)$ and $X$ is the jacobian of the $K$-curve $y^3=x^9-x-t$. See Example 4.3 of     arXiv:math/0606422 [math.NT] [MR2289628 (2007j:11077)] for details.
If $p>2$ and $g>1$ is an odd integer then there exists a $g$-dimensional ordinary abelian variety $X$ over a suitable  $K$, whose endomorphism algebra is an imaginary quadratic field; in particular, $X$ is absolutely simple and its $K/k$-trace is trivial. See Theorem 1.5(i,ii) of the same paper that is based on a construction of Oort and van der Put. (Actually, the condition $p>2$ could be dropped.)