Question: ACME Environmental Consultants works on Environmental Engineering projects in Australia and New Zealand. It is trying to determine what proportion of its operations should occur in the two countries. It is particularly concerned about reducing the number of years where it has poor returns. The average return in the two countries is the same, but the variability is different. The standard deviation of the return in Australia is 0.73, while the standard deviation of the return in New Zealand is 0.8. The covariance of the returns from the two countries is 0.46. Determine the proportion of the business that should operate in Australia to minimise the overall variance of the company’s return. (Answer to 2 decimal places) Determine the standard deviation of the return that the company will make if it uses this proportion. (Answer to 2 decimal places)

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