1. Estimate your exposure to the exchange risk.
2. Compute the variance of the dollar value of your property that is attributable to exchange rate uncertainty.
3. Discuss how you can hedge your exchange risk exposure and examine the [possible] consequences of hedging.

Support your analysis by referencing and citing at least two credible sources, in addition to the textbook, that you used to assist you in your responses.

4. Diversification: Minimum 700 words

What are the advantages of creating a diversified international portfolio? What are the risks? In answering the questions, critically assess the risk factors that an international investor faces and how diversification serves to mitigate risk. Then discuss how the theory of an optimum international portfolio (from Chapter 15) informs your analysis. Support your analysis by referencing and citing at least three credible sources other than the course textbook.

The attached Tata Motors case study provides some insight into the difficulties that firms in developing countries face when they try to export their products and services. For this assignment, select an industry or a specific export from a developing country that faces particularly challenging barriers to entry into foreign markets. Describe the industry, explain how it could help the developing economy, and analyze the nature of the barriers that it faces in foreign markets. You will likely need to rely on extensive external sources for your research. In addition, consider the Tata Group Case Study and the questions that accompany it as you analyze and explain the challenges that your selected industry or export presents. Support your analysis by referencing and citing at least three credible sources.