Question: PLEASE WRITE ANSWER IN YOUR OWN WORDS BECASUE I HAVE TO SUBMIT THE ANSWER ON TURTIN 1. Provide an appropriate answer to the following questions:

PLEASE WRITE ANSWER IN YOUR OWN WORDS BECASUE I HAVE TO SUBMIT THE ANSWER ON TURTIN

1. Provide an appropriate answer to the following questions:

a. What are the main differences between preference shares and ordinary shares? Explain.

b. Explain the concept of Diversification in finance.

c. Explain the terms systematic risk and unsystematic risk.

d. Explain each of the components of the Weighted Average Cost of Capital formula below:

WACC = [ D/V (1 Tc)rdebt] + (E/V requity)

D =

V =

Tc =

rdebt =

E=

requity =

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