Q2.a) MAP Ltd. is a Pakistan based firm that is considering the location of new investmentprojects. They have to invest 35 percent of their funds in Pakistan. For the remaining 65%funds they are considering two different locations i.e. Middle East and Africa. Thecharacteristics of the proposed projects are as follows. Compute portfolio risk and return:35%For30% funds35% fundsInvestment inif investedif investedPakistanin M Eastin AfricaProject'sexpectedafter-tax returnmean14%16%16%annualStandard deviation of0.070.110.12project's returnCorrelationof0.210.08project's returns ofPakistan'sinvestmentwithreturn on the otheroptionsPage 2 of 4***correlation of 30% Middle East investment's return with returns from 35% Africa'sinvestment-0.17a) Discuss factors to be considered a MNC while investing in foreign countries.

The question is based on the concept of return and risk calculation of portfolio with three…

a) MAP Ltd. is a Pakistan based firm that is considering the location of new investment projects. They have to invest 35 percent of their funds in Pakistan. For the remaining 65% funds they are considering two different locations i.e. Middle East and Africa. The characteristics of the proposed projects are as follows. Compute portfolio risk and return: 35% For 30% funds 35% funds Investment in Pakistan if invested if invested in M East in Africa Project's expected after-tax return mean 14% 16% 16% annual Standard deviation of 0.07 0.11 0.12 project's return Correlation of 0.21 0.08 project's returns of Pakistan's investment with return on the other options Page 2 of 4 ***correlation of 30% Middle East investment's return with returns from 35% Africa's investment=0.17 a) Discuss factors to be considered a MNC while investing in foreign countries.

a) MAP Ltd. is a Pakistan based firm that is considering the location of new investment projects. They have to invest 35 percent of their funds in Pakistan. For the remaining 65% funds they are considering two different locations i.e. Middle East and Africa. The characteristics of the proposed projects are as follows. Compute portfolio risk and return: 35% For 30% funds 35% funds Investment in Pakistan if invested if invested in M East in Africa Project's expected after-tax return mean 14% 16% 16% annual Standard deviation of 0.07 0.11 0.12 project's return Correlation of 0.21 0.08 project's returns of Pakistan's investment with return on the other options Page 2 of 4 ***correlation of 30% Middle East investment's return with returns from 35% Africa's investment=0.17 a) Discuss factors to be considered a MNC while investing in foreign countries.

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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