a) Investor "A" has a portfolio of assets that contains all government bonds. Is she ignoring any principles of portfolio choice? Explain.

(b) Investor "B" has a portfolio of assets that contains all Apple stock. Is she considering all the principles of portfolio choice? Explain.

(c) Investor "C" has a portfolio comprised of 50% low-risk bonds and 50% Apple stock. Is this a preferable choice for a risk-averse person? Explain why or why not.

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1 Jun 2022

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Why do CDs have lower rates of return than stocks?

CDs are much riskier investments than stocks.

CDs are less risky than stocks.

CDs are not taxed while stock s returns are taxable.

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