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Intro Rockweill Inc. produces computer chips in the U.S. and sells them domestically and in Canada. To measure its economic exposure, the company ran a
Intro Rockweill Inc. produces computer chips in the U.S. and sells them domestically and in Canada. To measure its economic exposure, the company ran a regression analysis to explain the expected percentage change in annual U.S. dollar cash flows (PCF): E(PCFt) = 0.015 +2.5E(et) where E(et) is the expected percentage change in the exchange rate for the Canadian dollar (measured in U.S. dollars per Canadian dollar). Part 1 Attempt 5/10 for 10 pts. If the Canadian dollar is expected to depreciate by 6%, what is the expected percentage change in annual U.S. dollar cash flows? 3+ decimals Submit
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