What is volatility of the portfolios of addison

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Reference no: EM131910390

1. Assume Scarlett Corporation, a US-based MNC, invests 2,500,000 Zambian kwacha (ZMK) for a one-years period at a nominal interest of 9 percent. At the time the loan is extended, the spot rate of the kwacha is USD 0.00060. If the spot rate of the kwacha in one year is USD 0.00056., the dollar amount initially invested in Zambia is USD___, and the USD__ are paid out after one year.

1,500; 1,526

1,526; 1,500

1,500; 1,400

1,400; 1,500

none of the above

2. Suppose Wesley? Publishing's stock has a volatility of 60%?, while Addison? Printing's stock has a volatility of 20 % If the correlation between these stocks is 70 % what is the volatility of the following portfolios of Addison and? Wesley:

a. 100% Addison

b. 75% Addison and 25% Wesley

c. 50% Addison and 50% Wesley

Reference no: EM131910390

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