1) The initial impetus for globalized financial markets came from the governments of major countries deregulating their domestic financial markets, allowing more foreign participation in them. T or F.

2) Secuurity returns are substantially less correlated--------------------countries than---------------------countries.

3) Investors diversify their portfolio holdings to:

    a. increase their returns

    b. help more borrowers in financial markets

    c. help low income countries

    d. mitigate risk

4) -------------------------risk refers to the risk that remains even after investors fully diversify their portfolio holdings.

5) The Sharpe Performance Measure:

    a. provides a risk-adjusted performance measure for national stock markets

    b. represents the excess return above and beyond the "risk-free" interest rate per standard deviation.

    c. equals the "mean of returns" minus the the risk free interest rate divided by the standard deviation of returns.

   d. all of the above