Some switches can work at Layer 3, but they are far from plain switches.....some routers contain a switch but that's another story.
Ask him this.... if switches and routers do the same thing, why do we have routers to route traffic, and switches to switch traffic if it's the same thing??
VLAN. Not something you'd be able to set up on a basic switch of course and the end result is effectively the same as connecting directly to a router/computer. But you can set your switch up so that, for example, ports 1 and 2 are untagged in VLAN 10 (no other members) with PVIDs set to 10 also. You connect your modem to port 1 and your router/computer to port 2. Hey presto you have your modem connected to a switch and working.
That's pretty pointless on its own though. I use this idea so that I can pipe the modem directly into a vSphere cluster and pick up the DHCP lease from a VM inside that.
But as above, generally you can't connect a modem to a switch and expect everything to work
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