11.2 You have just received good news. You have a rich uncle in France who has decided to give you a monthly annuity of 2,000 per month. You are concerned that you will become accustomed to having these funds, but if the currency exchange rate moves against you, you may have to make do with less.

A. If you are living in Canada, what does it mean for the currency exchange rate to move against you?

B. Would moving to France mitigate some of the risk? If so, how? If not, why not?

C. If you want to stay in Canada, and your grandparents, who have retired to Provence, receive a Canadian pension of C$1100 each, what could you do to reduce the risk for all of you?