Please answer questions 1-5. Thanks!

Questions: 1. Consider the following excerpt by an investment company: "The company uses a bottom-up. research-driven process to identify investments and construct portfolios." What does the company mean by a bottom-up process? 2. Suppose you purchased the stock of company ABC exactly one year ago at $80 per share. Within the last year, the company paid out $4 dividends per share. After paying out the dividends, the company also had a 5-for-1 stock split. Currently, the stock is trading at $18 per share. What is your total return on investment on this stock? 3. A T-bill quote sheet has 90-day T-bill quotes with a 0.072% bid and a 0.064% ask. If the bill has a $10,000 face value, at what price can an investor sell this bill? 4. Suppose you are trying to decide between buying one of the following two bonds, a municipal bond with 7% rate of return and a corporate bond with 10% rate of return. Assume all other characteristics of these two bonds are the same (riskiness, maturity etc.). If you pay 10% state tax and 20% federal tax on your taxable returns, which bond would you prefer to buy? Why? 5. Consider the three stocks in the following table represents price at time, and represents shares outstanding at time. The stock C had a 2-for-1 stock split after the market closed on time -0. A 80 120 95 120 B 60 200 40 200 C100 150 60 300 a. Calculate the rate of retum on a price-weighted index of the three stocks for the first period (t-otot-1). b. Calculate the rate of return on a market value-weighted index of the three stocks for the first period (t-0 tot-1). c. Calculate the rate of return on an equal-weighted index of the three stocks for the first period (1-0 tot=1). 2