Question: 1. What are differences between transaction and operating exposures to exchange rate risk? 2. What are reasons to believe that investors could enjoy benefits from

1. What are differences between transaction and operating exposures to exchange rate risk?

2. What are reasons to believe that investors could enjoy benefits from international diversification?

3. A Thai firm is evaluating an investment project in Bangladesh. How could the cost of capital for this project could be estimated such that it is consistent with the CAPM?

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