International diversification provides a better risk-return-trade-off than does investing solely in US securities primarily because?

a. there are many more attractive investments to choose from overseas

b. the foreign securities may closely follow US markets in their price movements.

c. foreign securities offer greater access to internal business information of the company

d. the economic cycles of other nations may not be perfectly in phase with the US economy.

2. Nissan, the janapense car manufacturers,e sports a substantial fraction of its output to he united states. what hedging strategy would be suitable for nissan to take to reduce its currency risk to US dollars?

a. borrow only euros to finance its operations

b. hedge the amount of annual US dollars sales exposed with yen forward contracts

c. buy pound forward in the amount of its annual shipments to the US

d. sell euros forward in the amount to its annual shipments o the US