Question: EAFE Weight Return on Equity Index E1/E0 Managers Weight Managers Return Europe 0.30 20% 0.9 0.35 18% Australasia 0.10 15 1.0 0.15 20 Far East

EAFE Weight Return on Equity Index E1/E0 Managers Weight Managers Return Europe 0.30 20% 0.9 0.35 18% Australasia 0.10 15 1.0 0.15 20 Far East 0.60 25 1.1 0.50 20 If the current exchange rate is $1.75/, the 1-year forward exchange rate is $1.85/, and the interest rate on British government bills is 8% per year, what risk-free dollar-denominated return can be locked in by investing in the British bills?

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