1. Suppose that S = $1.1045/. An American purchased a French asset. The French asset is expected to yield 5.7%. Also, the euro is expected to depreciate by 3.6% against the dollar. What is your exact expected return?(Round to the nearest 100th decimal)

2. Suppose that S = $1.1045/. The inflation rate is 5% in the US and 3% in Germany. The real exchange rate is expected to increase by 4%. What is the exact currency movement for the euro?(Round to the nearest 100th decimal)

3. Consider the following:

U.S. risk free rate = 2%

French risk free rate = 2.75%

S=1.10 dollar/euro

French investment yields 8%

Euro is expected to appreciate by 3%

--> Find the U.S investor's risk premium

4. Suppose the following:

CORR(r(A),r(M))=.45

SD(r(M))=20%

SD(r(A))=15%

--> Find the variance of the variance of Asset A's returns that is attributed to non-systematic risk. (Round to the nearest 100th decimal)