1. ABC Corporation must decide to invest either in Germany or in China. The existing operation (100% in the U.S.) can generate 15% in return and 20% Standard Deviation. If investing in Germany for 30% of its operation (70% in the U.S.), the return in Germany facility is 20% with 30% Standard Deviation. If investing in China for 30% of its operation (70% in the U.S.), the return in China facility is 20% with 35% Standard Deviation. The correlation between U.S. and Germany, U.S. and China are 0.2 and 0.05, respectively.

1. Calculate the return for ABC Corporation if investing in Germany.

2. Calculate the return for ABC Corporation if investing in China.

3. Calculate the Standard Deviation for ABC Corporation if investing in Germany.

4. Calculate the Standard Deviation for ABC Corporation if investing in China.

5. Explain why the result in part c and d is different.