1. As a consultant of ABC Company, you are requested to answer the following, providing concise explanation.

a. How do you calculate a portfolio return?

b. Conceptually, how are covariance and correlation different?

c. How does adding stocks to a portfolio affect its volatility?

d. What is the efficient frontier?

e. What is the Sharpe ratio, and what does it measure?

f. What is the minimum variance Portfolio?

g. How does beta affect an investments cost of capital?

h. Is the market portfolio efficient? Justify your answer.

i. How are the capital market line and security market line similar? How are they different?

j. Differentiate between the Capital Market Line and the Security Market Line

k. Differentiate between systematic and unsystematic Risk