Detailed Answer
(d) The requirement is to identify the risk of loss because
of fluctuations in the relative value of foreign currencies.
Answer (d) is correct because the risk of fluctuations in the relative
value of foreign currencies is referred to as exchange rate risk.
Answers (a) and (b) are incorrect because expropriation and
sovereign risks relate to the possibility that a country might seize
a foreign investment. Answer (c) is incorrect because multinational
beta would be risk of the individual investment relative to
the multinational market as a whole.
