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Question 17 (3 points) A Korean investor invests S$500,000 in stock X and S$750,000 in stock Y. The current spot rate is Won0.9165/S$. The portfolio
Question 17 (3 points) A Korean investor invests S$500,000 in stock X and S$750,000 in stock Y. The current spot rate is Won0.9165/S$. The portfolio return in domestic term is State of Economy Probability Return (X) Return (Y) Boom Normal Recession 0.1 0.5 0.4 20% 12% -8% Exchange Rate (S$/Won) 0.9079 0.9259 1.0015 7% 15% 30% A) 14.04% B) 15.41% C) 18.77% D) 10.96% E) 16.15%
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