1 - Peterson Ukraine Russia Expected return 10% 20% 40%...

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Peterson Inc., a U.S. firm, plans to invest in a new project that will be located either in Ukraine or in Russia. If the Ukraine project is selected it will constitute 35% of the firm's total funds invested in itself. If the Russia project is selected it will constitute only 15% of the firm's total funds. You have the following data on expected returns for each project:
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Unformatted text preview: Peterson Ukraine Russia Expected return 10% 20% 40% Standard deviation 25 30% 50% Correlation with existing Crane's portfolio 1.00 .50 .05 Weight on overall portfolio- .35 .15 Which project would you recommend to Peterson? Why?...
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