(8) Q.4:- Following are the direct exchange rates of Euro (EUR) and Canadian Dollar (CAD) at the beginning of each of the last 10 months are given. Year EUR/USD CAD/USD 2011 $1.39 $1.01 2012 $1.28 $1.00 2013 $1.33 $0.97 2014 $1.33 $0.91 2015 $1.11 $0.78 2016 $1.11 $0.76 2017 $1.13 $0.77 2018 $1.18 $0.77 2019 $1.12 $0.75 2020 $1.14 $0.75 a). It is forecasted that the Euro will appreciate by 4 percent over the next year but it is realized that there is much uncertainty revolving around this forecast. Using the Value at risk method estimate the maximum level of depreciation in the Euro in coming year. b) Assume that Canadian Dollar is expected to depreciate by 3 percent in coming year but again this forecast is uncertain, therefore you need to estimate maximum level of depreciation using the value at risk method over the next year. Note: Estimate your answer based on 95 percent confidence level.