1. What is James Montier's basic conclusion about how much the dividend component of returnsmatters to investors and their total return [the dividend component is the combination of dividend yield and growth while the non-dividend or capital gain component consists of the change in value or price] ?
2. The dividend component drives about the same portion of the total return as the capital gain component (they both contribute about 50%) if considering short periods of time (1 year) or long periods of time (5+ years).
3. The capital gain component drives the largest portion of the total return if considering long periods of time (5+ years) whereas the dividend component drives the largest portion of return if considering short periods of time (1 year).
4. The dividend component drives the largest portion of the total return if considering long periods of time (5+ years) whereas the capital gain component drives the largest portion of return if considering short periods of time (1 year).

Given that Behavioral Finance helps confirm that people make investing mistakes, select the best answer regarding the opportunity for other investors('savvy investors')to profit from these mistakes:

a.If a savvy investor can spot other peoples' mistakesin the market, the savvy investor will be able to profit from these mistakes byusing a procedure called 'Arbitrage'.

b. Savvy investors will tend to have more opportunity for profits if the mistakes are short- term in nature but less or no opportunity for profits if the mistakes are chronic or structural in nature

c. When bubble market periods occur such as technology & internet stocks in the late1990's and real estate-related investments in the mid-2000s, the extreme price gaps relative to fundamental value and the many years these gaps exist allow savvy investors to spot the opportunities and to take advantage of them.

1. You were talking with one of your class mates at your high school re-union-Bill Bopley-and hetells you he doesn'tneed or want a job because he makes plenty of cash sitting at home 3 or 4 days a week trading stocks. His strategy is to buy stocks that just went up between 3% and 5% within the last week and to short stocks that fell by 3% to 5% in the last week. He also checksthe 'fundamentals' of these stocks, making sure thatif he is buying stocks that go up they are categorized as growth stocks (high growth rates, high P/E ratios, sell technology, etc.) and if he is selling stocks that go down they are categorized as value stocks (low growth rates, low P/E ratios, sell basic consumer goods, etc.). What Behavioral Finance terms best apply to Bill and his investment strategy? Check all that are valid...
2. ______Representativeness
3. ______Mental Accounting
4. ______Anchoring
5. ______Loss Aversion
6. ______Over-Confidence