Beluncas Hijo from Las Vegas, United States has bought cornfields in Wales, England in 2019. He plans to sell the land in 2022. He was informed that in 2022, the land will be worth 12,000 if the agriculture land market is to be sold during pandemic COVID-19 and British pound will be at $1.90/. However, the land will be worth higher at 15,000 if the agriculture land market is to be sold during endemic (after pandemic COVID-19 ended) and the pound will be at $2.20/. The probability for the Englands agriculture land market during pandemic is 60 percent probability and during endemic with a 40 percent probability respectively.

(a) What is Beluncas Hijo s exposure to the exchange rate risk?