1. If you engage in stock-picking activities, what would be the counter-argument for stock investments? What are the advantages and disadvantages of each approach? 2. What would happen to P/E if rr...

1. If you engage in stock-picking activities, what would be the counter-argument for stock investments? What are the advantages and disadvantages of each approach?

2. What would happen to P/E if rr increased? What is the implicit assumption in this case? Explain.