1. Carefully review the various steps involved in the quantitative analysis that HMC has conducted (explained under the title “The Optimal Portfolio Allocation Study” on page 7) to determine an appropriate Policy Portfolio. What are the key quantitative inputs? What are the outputs? What are the strengths and weaknesses of this analysis?
2. As a Board member of HMC, which of the asset mix would you suggest HMC to adopt from amongst the ones presented in Exhibit 19? Why?