Question 9.ST.6: Warden Co. is considering a project in Venezuela, which will...

International Financial Management

Warden Co. is considering a project in Venezuela, which will be very profitable if the local currency (bolivar) appreciates against the dollar. If the bolivar depreciates, the project will result in losses. Warden Co. forecasts that the bolivar will appreciate. The bolivar’s value historically has been very volatile. As a manager of Warden Co., would you be comfortable with this project? Explain.

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