Question: 4. A Foreign stock is expected to give you a 9% rate of return, and Foreign currency (FC) is expected to appreciate against domestic

4. A Foreign stock is expected to give you a 9% rate

4. A Foreign stock is expected to give you a 9% rate of return, and Foreign currency (FC) is expected to appreciate against domestic currency (DC) by 2%, the spot rate is FC: DC=1.2, one-year future rate is FC: DC-1. 21, Find the DC expected rate of return on hedged investment (10 points)

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