Question: 1. Why does money have a time value? Why is it important? 2. Discuss whether the standard deviation of a portfolio is, or is not,

1. Why does money have a time value? Why is it important?

2. Discuss whether the standard deviation of a portfolio is, or is not, a weighted average of the standard deviations of the assets in the portfolio. Fully explain your answer.

3. You want to invest in bonds. Explain whether or not each provision listed will make the bonds more or less desirable as an investment: call provision, convertible bond provision, and subordinated debt.

4. What is the difference between common stock and preferred stock? Is one better than the other?

5. Discuss the pros and cons of stock buyback.

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