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Scope of Financial Management

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Would you please tell me which statements are incorrect? Why?

a When a loan is amortized, the interest portion and principal portion of the payment decreases and increases, respectively, each period during the life of the loan.
b It is impossible to construct a portfolio of risky assets whose return is equal to the risk-free rate.
c If a portfolio has a positive investment in a number of assets, the expected rate on the portfolio can be greater than that on every asset in the portfolio.
d The common stock of a non-growth firm is valued in the same way as its preferred stock.

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The solution examines scope of financial management.

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Incorrect statement: b It is impossible to construct a portfolio of risky assets whose return is equal to the risk-free rate.

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