For each statement choose TRUE OR FALSE?

1) A short sale involves purchasing shares first and then sell them to another party.
2) The average historical return of a stock is the same as its expected return going forward.
3) If a risky portfolio P and T-Bills are combined into a complete portfolio C, then C's Sharpe ratio doesn't depend on the weight allocated to P.
4) Macro risk can be diversified away by holding a large number of stocks in your portfolio.