After the assessment of country risk analysis in Slovakia, Skymax Co., a U.S. firm, has considered to account for 30% probability of the political crisis. The Skymax Co is planning to invest $3.5 million in a project in Slovakia that will exist for one year. The required rate of return on this project is 28%. It expects to receive cash flows of 3 million euros in one year from this project. The spot rate of the euro in one year is expected to be $1.55, and the one-year forward rate of the euro is presently $1.45. Besides, Skymax Co. forecasted that the cash flows would drop to 2 million euros in one year if the crisis happens. However, Skymax Co. does not intend to hedge its expected cash flows.