Question: a . Why are some risks diversifiable and some nondiversifiable? Give an example of each. ( 6 points ) b . What strategies can you

a. Why are some risks diversifiable and some nondiversifiable? Give an example of each.(6 points)
b. What strategies can you use to achieve effective diversification?(2 points)
c. How are bond prices influenced by whether a bond trades at a premium, discount, or par? What is the connection between the coupon rate and these price changes? (6 points)

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