A Canadian Plans to Buy 100 Shares of This American

question 55

Multiple Choice

$\begin{array}{|l|r|r|rr} \hline& \text { Expected Return } & \begin{array}{r}\text { Standard Deviation of } \\\text { Return }\end{array} &{\text { Correlation }} \\& & & \text { Coefficients } \\& & & \text { X }& \text {Y} \\\hline \text { Canadian Stock X } & 6 \% & 9 \% & 1.00 & \\\hline \text { American Stock Y } & 4 \% & 8 \% & 0.80 & 1.00\\ \hline\end{array}$

A Canadian plans to buy 100 shares of this American stock for US $20 per share. The current spot rate is C$1.2977 = US $1. Suppose that this investor can sell the stock for US $30 a share a year later. The spot rate at the time of the sale is C$1.3029 = US $1.
-How much does this investor have to pay in Canadian funds for those American stocks now?

• A) $2,605.80
• B) $1,541.20
• C) $2,595.40
• D) $2,302.50
• E) None of the above

---

Definitions:

Syntax

The set of rules that defines the combinations of symbols that are considered to be a correctly structured document or fragment in a given language.

Custom Function

A user-defined operation in software that performs specific calculations or actions not built-in by default.

Access Module

A component or software tool that provides a way to retrieve and manage data from a database or information system.

Visual Basic

A programming language developed by Microsoft, designed to be easy to learn and use, primarily for creating Windows applications.