1. Suppose that during a ten-year period, the standard deviations of the returns for the NZX 50 and the S&P/ASX 200 indices were 0.27 and 0.14, respectively, and the covariance of these index returns was 0.03. What was the correlation coefficient between the two market indicators?

A.

0.1111

B.

0.2142

C.

1.26

D.

0.7937

2. Suppose that during a ten-year period the standard deviation of the returns for the Hang Seng and the S&P/ASX 200 indices were 0.10 and 0.09, respectively, and the covariance of these index returns was 0.0009. What was the correlation coefficient between the two market indicators?

a.

0.1100

b.

0.1322

c.

0.1000

d.

0.1258