Assume you invest in the British equity market and have a 10 percent decline (quoted in British pounds).
a. If during this period the pound appreciated by 10 percent against the dollar, what would be your actual return translated into U.S. dollars?
b. If during this period the pound appreciated by 20 percent against the dollar, what would your actual return be translated into U.S. dollars?
c. Recompute the answer based on a 20 percent decline in the pound against the dollar.