Answer the 3 questions below. Be sure to number and answer each question separately. Responses should be at least 200 words and should link back to the assigned reading. It is not sufficient to simply state your opinion, you must support your opinion with information from the textbook.
1. Explain what is meant by the risk-return tradeoff. (Ch.4)

2. What is correlation and how is it important to managing a portfolio? (Ch.5)

3. Describe two major investment advantages of common stocks. (Ch.6)



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