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Q. Volusia, plc is a UK-based exporting firm that expects to receive payments denominated in both euros and Canadian dollars in one month. Based on today's spot rates, the pound value of the funds to be received is estimated at £500,000 for the euros and £300,000 for the Canadian dollars. Based on data for the last fifty months, Volusia estimates the standard deviation of monthly percentage changes to be 8 percent for the euro and 3 percent for the Canadian dollar. The correlation coefficient between the euro and the Canadian dollar is 0.30. What is the portfolio standard deviation?

Q. The Bank of England may use a stimulative monetary policy with least concern about causing inflation if the pound's value is expected to:

Q. The North American Free Trade Agreement (NAFTA) increased restrictions on:

Q. Arbitrageurs in foreign exchange markets:

Q. The lower a project's beta, the _______ is the project's _________ risk.

Q. The __________ the percentage of an MNC's business conducted by its foreign subsidiaries, the _________ the percentage of a given financial statement item that is susceptible to translation exposure.

Q. An international project's NPV is _________ related to the size of the initial investment and _________ related to the project's required rate of return.

Q. With regard to hedging translation exposure, translation losses _______; and gains on forward contracts used to hedge translation exposure _______.