Assuming That the Interaffiliate Cash Flows Are Uncorrelated with One

Assuming that the interaffiliate cash flows are uncorrelated with one another,calculate the standard deviation of the portfolio of cash held by the centralized depository for the following affiliate members: $$\begin{array} { l c c } \text { Affiliate } & \begin{array} { r } \text { Expected } \\\text { Transactions }\end{array} & \begin{array} { c } \text { Standard } \\\text { Deviation }\end{array} \\\hline \text { U.S. } & \$ 100,000 & \$ 40,000 \\\text { Canada } & \$ 150,000 & \$ 60,000 \\\text { Mexico } & \$ 175,000 & \$ 30,000 \\\text { Chile } & \$ 200,000 & \$ 70,000\end{array}$$

A) $34,960.33
B) $139,841.33
C) $104,880.88
D) None of the above

Correct Answer:

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