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Briefly discuss the focus of the investment decision, the financing decision, and the working capital and short-term operating decisions and how these decisions are interrelated with each other.

The expected return and risk of the portfolio are two of the most important measures of attractiveness. Precisely & completely explain how the expected return and standard deviation of the returns on the portfolio are determined. (Please use words in your explanation as well as formulas).

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The question wants you to discuss the investment decision, the financing decision, and the working capital and short-term operating decision and, their interrelationship. Then it requires you to give one formula of the expected return on investment and standard deviation.
<br>There are several assumptions which the question makes first it assumes that the decision on investment, finance, working capital and short-term operating decisions are related to the same company, this is not supported by evidence. Often there is a competition for investment for funds and investment from sources which are outside the company. For instance often funds in high demand are invested in the holding company. Second, it ...

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