13. If the correlation between all pairs o securities equals zero, we try the simple diversification strategy of dividing our wealth equally among each asset (1/N). As N grows to infinity, what is the the variance the portfolio?

Group of answer choices

0

1/N

i=1N1N22+ijCov(i,j)

1/N²

^14. A corporation is considering purchasing a machine with an expected eight-year life and will generate for the firm $11,000 per year in net operating income before taxes. Using the straight-line method, its anticipated salvage value is $12,000. The firm has a 21% marginal tax rate and the required return for this project is 12%. A salesman wants to negotiate the price of machine. What is the maximum price the company is willing to pay? (Hint: Change income for eight years.)

Group of answer choices

57117

53416

50000

57929