Problem 1:

Problem 1 Part 1 Attempt 2/5 for 9 pts. Which of the following statements are true about exchange rate risk? Check all that apply: Exchange rate risk arises from the uncertainty in asset returns due to changes in the exchange rate between the currency of the investor and the foreign currency. Exchange rate risk can't be perfectly hedged, even if the return earned in the foreign currency is known beforehand. A Canadian investor with an investment in U.S Treasury bills faces exchange rate risk. Exchange rate risk can be hedged using a futures or forward contract in foreign exchange. Submit