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Consider the following returns:

Period United States United Kingdom Exchange Ratea

1

10%

5%

$3

2

15%

-5%

2.5

3

-5%

15%

2.5

4

12%

8%

2.0

5

6%

10%

1.5

6

 

 

2.5

What is the average return in each market from the point of view of a U.S. investor and of a U.K. investor?

Basic Finance, Finance

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