Instructions: In the space below each question, respond in as much detail as required to the following two questions. Your responses should be at least two paragraphs in length for each essay. Please provide well thought-out, documented responses to the essay questions below.

1. Discuss the tools that you have learned for analyzing financial statements. Be sure to discuss what information is found on the Income statement and Balance sheet, and how this information can be used to determine the financial health of a company.

2. You have a friend who tells you that they are a conservative investor. They would like your advice for choosing 2 stocks to invest in. What 2 stocks would you recommend and why? Be sure to discuss risk, the Expected return for the portfolio, and how that compares with the actual returns.