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3. The one-year risk-free interest rates are 6 percent in DC and 3 percent in FC. The expected exchange rate appreciation of FC is 4

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3. The one-year risk-free interest rates are 6 percent in DC and 3 percent in FC. The expected exchange rate appreciation of FC is 4 percent. a. What is the foreign currency risk premium? b. Use two methods to calculate the return on the asset, assuming investor

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