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Please answer question 5 and 7 with examples .Thanks answer questions 5 and 7 only with examples to support the answer. Thanks 7. ginal corporate

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Please answer question 5 and 7 with examples .Thanks

image text in transcribed

answer questions 5 and 7 only with examples to support the answer. Thanks

7. ginal corporate tax rate. The legislation had been debated for the previous six months 5. Expected Portfolio Returns [LO1] If a portfolio has a positive investment in every asset, can the expected return on the portfolio be greater than that on every asset in the portfolio? Can it be less than that on every asset in the portfolio? If you answer yes to one or both of these questions, give an example to support your answer. 6. Diversification (LO2] True or false: The most important characteristic in determining the expected return of a well-diversified portfolio is the variance of the individual assets in the portfolio. Explain. Portfolio Risk (LO2] If a portfolio has a positive investment in every asset, can the standard deviation on the portfolio be less than that on every asset in the portfolio? What about the portfolio beta? Beta and CAPM [LO4] Is it possible that a risky asset could have a beta of zero?Explain. Based on the CAPM, what is the expected return on such an asset? Is it possible that a risky asset could have a negative beta? What does the CAPM predict about the expected return on such an asset? Can you give an explanation for your answer? Corporate Downsizing [LO1] In recent years, it has been common for companies to experience significant stock price changes in reaction to announcements of massive layoffs. Critics charge that such events encourage companies to fire longtime employees and that Wall Street is cheering them on. Do you agree or disagree? ginal corporate tax rate. The legislation had been debated for the previous six months. 5. Expected Portfolio Returns [LO1] If a portfolio has a positive investment in every asset, can the expected return on the portfolio be greater than that! on every asset in the portfolio? Can it be less than that on every asset in the portfolio? If you answer yes to one or both of these questions, give an example to support your answer. 6. Diversification (LO2] True or false: The most important characteristic in determining the expected return of a well-diversified portfolio is the variance of the individual assets in the portfolio. Explain. 7. Portfolio Risk [LO2] If a portfolio has a positive investment in every asset, can the standard deviation on the portfolio be less than that on every asset in the portfolio? What about the portfolio beta? 8. Beta and CAPM [LO4] Is it possible that a risky asset could have a beta of zero?Explain. Based on the CAPM, what is the expected return on such an asset? Is it possible that a risky asset could have a negative beta? What does the CAPM predict about the expected return on such an asset? Can you give an explanation for your answer? 9. Corporate Downsizing [LO1] In recent years, it has been common for companies to experience significant stock price changes in reaction to announcements of massive layoffs. Critics charge that such events encourage companies to fire longtime employees and that Wall Street is cheering them on. Do you agree or disagree

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