Question: Jackson Bank of Commerce estimates that building a new branch office in the newly developed Guider residential township will yield an annual expected return of 13 per-cent with an estimated standard deviation of 5 percent. The bank's marketing department estimates that cash flows from the proposed Guider branch will be mildly positively correlated (with a correlation coefficient of + 0.37) with the bank's other sources of cash flow. The expected annual return from the bank's existing facilities and other assets is 10 percent with a standard deviation of 3 percent. The branch will rep-resent just 10 percent of Jackson's total assets. Will the proposed branch increase Jackson's overall rate of return? Its overall risk?